Dive Brief:
- GlobalFoundries announced plans Wednesday to invest an additional $3 billion to expand its semiconductor manufacturing and advanced packaging capabilities in Malta, New York, and Essex Junction, Vermont.
- The funds will go toward research and development initiatives focused on packaging innovation, silicon photonics and new gallium nitride technologies, according to the press release.
- The money builds upon the company’s previously announced $13 billion investment in the two plants, as well as its upcoming advanced packaging and testing center on its Malta campus.
Dive Insight:
GlobalFoundries has been working on diversifying its supply chain over the past few months to get ahead of a 25% semiconductor tariff threatened by Trump earlier this year. As a result, the company has been turning toward its Malta and Essex Junction facilities to supply its customers, especially in the automotive sector.
“Semiconductors are critical to the future of vehicles, and their importance will only grow,” GM President Mark Reuss said in the June 4 press release. “GlobalFoundries’ investment supports our work to secure a reliable, U.S.-based chip supply — essential for delivering the safety, infotainment and features our customers expect.”
As customers weigh the impact of the tariffs, diversifying their supply chains is key to limiting risk exposure, then-GlobalFoundries President and CEO Thomas Caulfield said in a February earnings call. Former COO Tim Breen was named as the company’s new CEO effective April 28.
“We need to have the ability to source from different regions,” Caulfield said. “And I think it’s just raising the height of importance of diversification and supply chain with customers.”
In November, the Department of Commerce finalized GlobalFoundries’ $1.5 billion CHIPS and Science Act funding for its New York and Vermont facilities. The company was also awarded $550 million that will go toward ongoing upgrades and expansions.
But as the Trump administration reviews the future of the law, it’s unclear whether GlobalFoundries and other awardees will still receive their finalized funding. The company did not immediately respond to a request for comment on the status of its funding.
GlobalFoundries’ new investment addresses the “explosive growth” in AI, as the technology accelerates demand for new semiconductor capabilities and processes to power data centers, communications infrastructure and AI-enabled devices, according to the press release.
AI is especially driving demand for GlobalFoundries’ silicon photonics, GaN, and FDX technologies to power data centers, Breen said in a statement.
“The rapid rise of AI in both the cloud and at the edge is driving the adoption of new technology platforms and 3D heterogeneous integration technologies,” GlobalFoundries said in the press release. “These advanced solutions are essential to meet the exponentially growing requirements for power efficiency, bandwidth density and performance.”
The semiconductor supplier is also collaborating with major companies to reshore production to the U.S. and diversify global supply chains, including Apple, SpaceX, General Motors, AMD, Qualcomm Technologies and NXP.
“At GlobalFoundries, we are proud to partner with pioneering technology leaders to manufacture their chips in the United States — advancing innovation while strengthening economic and supply chain resiliency,” Breen said in a statement.
GlobalFoundries additional investment comes after the Commerce Department withdrew $210 million in federal grants that were approved for six U.S. technology and manufacturing hubs, including $23 million for the Vermont Gallium Nitride Tech Hub that the company co-founded with the state and the University of Vermont. The hub focuses on developing and commercializing GaN devices and boosting the semiconductor workforce in the state.
