On July 14, Japanese government-backed chipmaker JS Foundry filed for bankruptcy protection with the Tokyo District Court, citing liabilities of approximately ¥16.1 billion (about US$110 million). The company also announced it would halt operations immediately, leaving over 500 employees without jobs.

Founded in December 2022, JS Foundry was established through investments by Mercuria Investment, a subsidiary of the Development Bank of Japan, and industrial consultancy Sangyo Sosei Advisory. The company focused on contract manufacturing of power semiconductors used to regulate electric power in electric vehicles, home appliances, trains, and other large-scale electrical equipment.

The company's primary production base was its Niigata plant in Ojiya City, originally built by Sanyo Electric in 1984, later acquired by U.S. chipmaker onsemi in 2011, and transferred to JS Foundry in 2022.

JS Foundry generated strong initial sales of ¥10 billion in its first fiscal year. However, revenue plummeted after it ceased contract manufacturing for onsemi in May 2024, falling to just ¥2.6 billion for the fiscal year ending December 2024. In the previous fiscal year, the company recorded ¥3.14 billion in sales but posted a net loss of ¥1.37 billion, exposing ongoing profitability challenges.

Facing mounting financial pressure amid weak demand and declining orders, JS Foundry explored capital tie-ups with overseas companies in early 2025 and made efforts to enter the silicon carbide (SiC) power semiconductor sector. However, failed negotiations and a lack of new revenue streams ultimately led to the bankruptcy filing.

The collapse of JS Foundry adds to a growing list of struggles in the global power semiconductor sector. Earlier this month, U.S.-based Wolfspeed also filed for bankruptcy to restructure $4.6 billion in debt. Japan's ROHM recently posted its first net loss in 11 years, also tied to power semiconductor investment setbacks.

Power semiconductors are vital components in modern electronics, acting as the “commanders” of electrical energy. They enable efficient energy conversion, precise control, switching, and safety protection, making them critical for energy savings and carbon reduction in electric power systems.