Qualcomm, GlobalFoundries Sign Pact To Double Chip Manufacturing

Under a multi-billion dollar revenue agreement, the chips will be produced in GlobalFoundries’ factories in the United States, Germany, Singapore and France

Qualcomm and GlobalFoundries signed an agreement on Monday to more than double their existing long-term manufacturing agreement for chips used in 5G transceivers, Wi-Fi, automotive and Internet of Things (IoT) connectivity.

Under a multi-billion dollar revenue agreement, the chips will be produced in GlobalFoundries’ factories in the United States, Germany, Singapore and France.

The companies committed to support US-based manufacturing by expanding capacity at GlobalFoundries’ most advanced semiconductor manufacturing facility, in Malta, New York.

US chipmaker Qualcomm was one of GlobalFoundries’ first customers to sign a long-term agreement in 2021 to cover multiple geographies and technologies.

GlobalFoundries Chief Executive Thomas Caulfield said in a statement that having Qualcomm as a long-term customer of its upstate New York factory through 2028 would help, along with federal and state funding, to expand the company’s U.S. manufacturing footprint.

The US Senate last month passed sweeping legislation to subsidise the domestic semiconductor industry, providing about USD 52 billion in government subsidies for semiconductor production and an investment tax credit for chip plants estimated to be worth USD 24 billion. 

“With major new federal incentives for microchip manufacturing in the United States, I look forward to many more announcements like this to come,” said Senate Majority Leader Chuck Schumer.

The European Union has also eased funding rules for innovative semiconductor plants to boost its chip industry and cut dependence on US and Asian suppliers.

Intel and GlobalFoundries have announced expansion plans on both continents to benefit from the subsidies, with GlobalFoundries partnering with STMicroelectronics to build a USD 5.7 billion semiconductor factory in France.

(Reuters)