GlobalFoundries to Invest $1.4B in Expansion, Potential Earlier IPOby Anton Shilov on March 4, 2021 10:55 AM EST
- Posted in
- Fab 8
- 45 nm
GlobalFoundries this week reiterated plans to invest $1.4 billion this year in expansion of its manufacturing capacities across the world. Around one third of the sum will be co-invested by GlobalFoundries' customers who want to ensure that they have capacity allocation for years to come. The world's fourth largest foundry is also mulling to bring forward its IPO to late 2021 ahead of its original 2022 date.
In any typical year, GlobalFoundries spends about $700 million on expansion of its production capacities, however growing demand for chips has made clear the need for faster than normal groth - as a result the company is to invest $1.4 billion on expansion this year. The money will be divided equally between GlobalFoundries' sites in Dresden, Malta (New York) and Singapore, according to Reuters. Production capacity is expected to increase by 13% this year and by 20% next year as a result of the increased funding.
Last year GlobalFoundries said that it planned to significantly increase capacity it its Fab 1 located near Dresden. The company's German facility produces chips using 22FDX, 28SLP, 40/45/55NV as well as BCDLite technologies that are particularly important for automotive, mobile, IoT, and industrial applications. Capacity of Fab 1 in 2021 is expected to be in the range between 400,000 and 500,000 wafer starts per year. Increasing that number means that GlobalFoundries will be able to better address high-growth applications.
GlobalFoundries expects to raise around a third of $1.4 billion from its customers that will pre-pay to guarantee supply over the following years, the CEO of the company told Reuters. He did not name the clients.
In addition to boosting its existing production facilities, GlobalFoundries is also looking forward building another fab adjacent to its Fab 8 located in Malta, New York. Funding of the new facility will largely depend on subsidies and incentives provided by the U.S. Government and the state of New York as parts of the CHIPS for America act introduced last year. It should also be noted that Fab 8 in Malta recently recieved ITAR certification for DoD production on its 45 nm process, expanding GlobalFoundries' value as a home-grown chip manufacturer to the US government.
Back in 2020 GlobalFoundries earned approximately $5.7 billion in revenue, down from $6.176 billion in 2017. The company projects that in 2021 its revenue will grow by 9% to 10% year-over-year as a result of unprecedented demand.
Since demand for chips is growing and governments have investments almost ready to go, it would seems to be a good time for GlobalFoundries' initial public offering. Previously GlobalFoundries planned to go public in late 2022 or early 2023, but the company appears to be thinking about bringing it forward into the late 2021 timeframe. Currently GlobalFoundries is wholly owned by Mubadala, an Emerati state-owned holding company.
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Operandi - Thursday, March 4, 2021 - linkIs there any talk about them getting back into more leading edge processes? I have to assume that with the (US) government taking a real interest they are looking at them as a local resource for new cool shit for the technology sector of the economy not just satisfying old crusty DoD contracts.
Duncan Macdonald - Thursday, March 4, 2021 - linkGF is highly unlikely to produce 10nm and smaller - the required investment would be too large. Only TSMC, Samsung and Intel are large enough to be able to afford 10nm and smaller. (A single modern FAB can cost over three times GF annual revenue (not just profit).) GF will stick to the easier processes.
Calin - Thursday, March 4, 2021 - linkI think GF is already producing 12nm wafers, and has decided to stop working on its 7nm process sometime last year.
The 12nm wafers it produces are a small improvement over its 14nm process.
Mobile-Dom - Thursday, March 4, 2021 - linkits 12nm FF wasnt much of an increase, the 12nm FD-SOI (12FDX) was pretty impressive if what I read was correct
ksec - Thursday, March 4, 2021 - linkI think GF focus on FD-SOI is the right path. It is hard to compete against Intel ( funded by x86 CPU ), Samsung ( funded by NAND and DRAM ) and TSMC.
del42sa - Friday, March 5, 2021 - link12FDX is halted and postponed to 2024. It was originally scheduled to begin in 2020
del42sa - Friday, March 5, 2021 - link"GF is highly unlikely to produce 10nm and smaller - the required investment would be too large. Only TSMC, Samsung and Intel are large enough to be able to afford 10nm and smaller. (A single modern FAB can cost over three times GF annual revenue (not just profit).) GF will stick to the easier processes."
They already invested in 7nm and 7nm EUV process, they also have at least two EUV machine AFAIK. If they want to stay relevant, they have to move to 7nm anyway, soon or later, but they simply have to. Of course the others will be by then on 5/3nm technology
scineram - Friday, March 5, 2021 - linkNo.
del42sa - Saturday, March 6, 2021 - linkyes
Spunjji - Monday, March 8, 2021 - linkThat would be a no - they cancelled their 7nm development more than two years ago: