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IBM has unveiled a new chip design that it says could allow manufacturers to pack 100 billion transistors onto a piece of silicon the size of a fingernail.
The current industry standard for chip size is measured in nanometers — a billionth of a meter, roughly the width of a few atoms — and sits at around 2nm. IBM claims its new chip technology is equivalent to about 0.7nm, potentially making it the first known sub-1nm chip design in the world. Production, however, is still several years away.
In testing, IBM's prototype performed 50% better than the company's existing 2nm chip and was 70% more energy efficient. The company made similar claims when it debuted its 2nm technology back in 2021, when early tests pointed to comparable gains in performance and efficiency.
Jay Gambetta, director of IBM Research and an IBM Fellow, called the new NanoStack architecture a "landmark moment" for the future of chip design. "With our new NanoStack architecture, we're not just making smaller transistors, we're reinventing how chips are built to deliver dramatically more power and energy efficiency," he said.
Packing in power
Transistors are the fundamental building blocks of silicon chips, which provide the computing power behind the world's electronics — smartphones, game consoles, laptops — as well as the data centers that handle everything from streaming and online banking to the generative AI boom.
The more transistors a manufacturer can fit onto a chip, the more powerful it becomes and the more it can do — all while designers try to keep the chips themselves as small as possible. For decades, the number of transistors that could fit on a chip doubled roughly every two years, a trend known as Moore's Law. But with chips now containing billions of transistors, that pace has grown harder to sustain, and most experts agree it cannot continue indefinitely.
Rather than packing transistors onto a flat surface, chipmakers have increasingly turned to 3D designs, reshaping transistors to make them taller. IBM's approach takes that further by stacking sheets of transistors on top of one another.
Alan Woodward, a professor of computer science at the University of Surrey, compared the approach to building a high-rise apartment block instead of a row of houses. "IBM's NanoStack is like proposing a 100-storey skyscraper," he said, adding that rivals such as Samsung and Intel are, by comparison, closer to building 30- to 50-story structures with their own 3D chip efforts.
Stacking transistors in this way brings its own engineering challenges. Heat is a major concern, since transistors heat up during operation and that heat naturally rises through the layers above. Layers that are too thin can also stop transistors from switching off properly, which can cause the chip to malfunction.
"I think it's fair to say IBM's proposals are the most ambitious," Woodward said.

Inflation pressure in the United States has climbed to its highest point in roughly two and a half years, giving the Federal Reserve's hawkish camp fresh ammunition just as the central bank settles in under new leadership.
Data released Thursday by the US Commerce Department showed the core Personal Consumption Expenditures (PCE) index, which strips out volatile food and energy prices, rose 3.4% year-over-year. On a monthly basis, the gauge ticked up 0.3%. That annual figure matches what Dow Jones-surveyed economists had been expecting, and it marks the steepest increase since October 2023.
Headline PCE, which folds in every category including energy and groceries, told a similar story. The seasonally adjusted annual rate jumped to 4.1%, the highest mark since April 2023. Month-over-month, headline inflation accelerated 0.4% — a touch softer than the 0.5% economists had projected, even though the annual number landed right on target.
Why Core Inflation Still Matters Most to the Fed
Fed officials track both readings, but core PCE remains their preferred compass since it's seen as a cleaner signal of where the economy is heading over the long haul. That distinction carries extra weight this year, given that much of the inflationary pressure has been traced back to surging energy costs tied to the conflict involving Iran — a shock that's increasingly spilling into other corners of the economy.
Markets shrugged off the report without much drama. US stock futures held their ground in positive territory, while Treasury yields eased slightly. Traders are still betting the Fed will move on interest rates by September 2026, though the odds of that outcome have softened a bit since the data dropped.
Energy once again did the heavy lifting behind the price increases, with energy-related goods and services jumping as much as 4% in a single month. Housing costs added another 0.3%, and financial services and insurance prices spiked sharply by 1.2%.
"Inflation is at a three-year high because of the war in America — sorry, I mean the war in Iran — and that's hitting lower- and middle-income Americans hard," said Heather Long, chief economist at Navy Federal Credit Union.
She added that households are paying more for gas, healthcare, and utility bills, and noted that new Fed Chair Kevin Warsh has been unambiguous about his determination to bring inflation under control. The real question, in her view, is how much relief shows up before the Fed's September meeting.
Consumer Spending and Incomes Defy the Pressure
Here's the curious part: even with prices running hot, American consumers kept spending at a clip that outpaced forecasts.
Personal spending rose 0.7% for the month, beating analyst estimates by 0.1 percentage point and actually outrunning the inflation rate itself. Personal income climbed by the same 0.7%, well above the 0.4% economists had penciled in. The personal savings rate, meanwhile, ticked up to 3%.
A Hawkish Fed Under New Leadership
This inflation snapshot lands just a week after Warsh's Fed rattled markets with unexpectedly tough talk on the future path of interest rates.
Warsh has made price stability his central message, and the Federal Open Market Committee (FOMC) went so far as to use unusually firm language in its latest statement, pledging to restore price stability after missing its long-standing 2% inflation target for five consecutive years. The committee also scrapped previously floated rate cuts for this year and signaled that a hike could be on the table sooner rather than later.
Complicating the picture further: central bankers typically look past price spikes tied to temporary supply disruptions, like an energy shock. But there's growing unease that this round of inflation is broadening across sectors, with tariff-related cost pressures adding another layer to the problem.
The Economy's Underlying Strength
A separate batch of data released the same day suggested the broader US economy remains on fairly solid footing.
The final reading for first-quarter GDP showed annualized growth of 2.1%, a notable upward revision from the previous 1.6% estimate and above the 1.7% economists had forecast. The Commerce Department attributed much of that upgrade to a smaller drag from imports.
On the labor front, weekly jobless claims for the period ending June 20 fell by 12,000 to 215,000 — comfortably better than the 223,000 economists had anticipated.
Two Forces Driving the Inflation Story
This inflationary stretch traces back to two intertwined developments: an escalating geopolitical crisis and a leadership shake-up at the nation's central bank.
The military conflict involving Iran has disrupted global crude oil supply chains, and since oil sits upstream of so much economic activity, the resulting price spike has rippled into logistics and production costs worldwide. Inside the US, that shock is increasingly showing up as sticky inflation in services, insurance, and everyday living costs.
At the same time, this is playing out just as the Fed changes hands at the top. New Chair Kevin Warsh inherited an institution widely seen as having moved too slowly, having missed its 2% inflation target for half a decade running. Where his predecessor leaned cautious and dovish, Warsh has brought a noticeably more aggressive posture to the job.
Under his direction, the Fed is now putting long-term price stability ahead of short-term growth — a shift that effectively closes the book on the era of cheap money and raises the odds of further tightening ahead as policymakers try to wrestle stubborn inflation back under control.