The US-headquartered foundry will spend $1.4 billion in 2021 to expand manufacturing and could accelerate its IPO, the report said. However, a major decision on building an additional wafer fab in Malta, New York, still hangs on US government support.
Globalfoundries is owned by Mubadala, a sovereign wealth fund of the Abu Dhabi, and the IPO could now happen late in 2021 rather than the previous plan of record which was for the IPO to take place in 2022 (see Globalfoundries ready for US government co-investment).
The capital expenditure will cover its three locations of the US, Singapore and Dresden in Germany and would be spread evenly between fabs to ramp production at nodes from 12nm to 90nm. About a third of the investment would come from customers paying up front to guarantee supply. Globalfoundries’ manufacturing capacity is expected to increase by 20 percent in 2022 after an increase of 13 percent in 2021, Caulfield told Reuters.
Globalfoundries backed away from pursuing leading-edge chip manufacturing at 7nm and finer geomtries a few years ago and is now focused on a rich set of manufacturing capabilities just behind the leading edge. It is aiming for 9 or 10 percent growth from revenue of $5.7 billion in 2020, Caulfield said.
Globalfoundries is responding to a shortfall in demand exacerbated by the Covid-19 pandemic and which has hurt automotive supply lines hard and first. That shortfall looks set to also impact other application sectors (see Volkswagen may claim damages over chip shortages). It has also given rise to questions about strategic self-sufficency in semiconductors in various regions (see Opinion: Time for Europe to wake from a 30-year slumber).
Caulfield said that he could bring forward capex because chip industry growth had been accelerated by the pandemic and was now expected to sustain compound annual growth rate of 10 percent over the next five years.
A decision to breakground on an additional wafer fab in Malta, New York would depend on US government funding measures to support domestic chip manufacturing, Caulfield added.
In Europe there are also moves afoot to boost domestic chip making but as yet no declared plan (see Germany ready to help Europe invest ‘billions’ in chip manufacturing).
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