Under the definitive agreement, the Palo Alto-based company will leverage its ReAQT platform and Large Quantitative Models to simulate and validate new chemical formulations. By training AI systems on the fundamental laws of physics rather than human language, SandboxAQ intends to compress development timelines that previously spanned decades into targeted, automated campaigns. In exchange for the capital, the Department of Commerce will receive a minority, non-voting equity stake in the firm.

The project targets four specific vulnerabilities: PFAS-free chemicals, advanced catalysts, rare earth-free magnets, and non-lithium battery systems. Currently, China controls over 90 percent of global neodymium-based magnet production, a dependency that leaves U.S. chip fabrication facilities exposed to significant geopolitical risk. SandboxAQ CEO Jack Hidary stated that the award allows the firm to move beyond theoretical research, transitioning successful breakthroughs into scaled domestic manufacturing with private partners.

Commerce Secretary Howard Lutnick emphasized that the initiative is central to the administration's goal of securing the semiconductor supply chain. By replacing foreign-controlled "forever chemicals" and critical mineral dependencies with domestically produced alternatives, the program seeks to insulate U.S. factories from potential supply shocks. The investment will specifically scale the company's existing AQCat and AQVolt workflows, which utilize quantum chemistry calculations to predict the performance of materials before they are synthesized in a laboratory setting.