Monday, March 8th 2021
Globalfoundries Investing $1.4 billion in Fabrication Capacity Expansion, Anticipate IPO
Globalfoundries has announced they are in the early stages of a massive $1.4 billion investment in their manufacturing capabilities, which aims to increase overall production of semiconductor chips. One third of this development investment will be pre-paid by Globalfoundries' customers, who by investing this way, are also pre-allocating Globalfoundries' future supply - it's a way for the company to receive funds for not-yet-produced wafers, enabling it to proceed with these expansion plans. The company usually reserves $700 million yearly for capacity expansions and technology improvements, so this $1.4 billion figure essentially doubles that.
That doubling comes at a time where existing capacity throughout the semiconductor industry is showing not to be sufficient for global demand. The plans will see Globalfoundries increase its wafer production capability by 13% this year, and 20% in 2022. The increased funding for developmental expenses will be allocated equally between the company's three manufacturing plants already installed in Dresden, Malta (New York) and Singapore. Globalfoundries' 2020 revenue ended up at $5.7 billion, a cutback from 2017's $6.176 billion. The company, however, projects its revenue to increase 9-10% in 2021 due to the current unprecedented demand for its fabrication technologies. The company is also looking to capitalize on this demand in another way: by bringing its IPO forward. Where before the company planned to go public in 2022 or even 2023, the increased current demand and prospective YoY growth places the company in a good place for such a move.
Source:
AnandTech
That doubling comes at a time where existing capacity throughout the semiconductor industry is showing not to be sufficient for global demand. The plans will see Globalfoundries increase its wafer production capability by 13% this year, and 20% in 2022. The increased funding for developmental expenses will be allocated equally between the company's three manufacturing plants already installed in Dresden, Malta (New York) and Singapore. Globalfoundries' 2020 revenue ended up at $5.7 billion, a cutback from 2017's $6.176 billion. The company, however, projects its revenue to increase 9-10% in 2021 due to the current unprecedented demand for its fabrication technologies. The company is also looking to capitalize on this demand in another way: by bringing its IPO forward. Where before the company planned to go public in 2022 or even 2023, the increased current demand and prospective YoY growth places the company in a good place for such a move.
15 Comments on Globalfoundries Investing $1.4 billion in Fabrication Capacity Expansion, Anticipate IPO
Is the IPO just ownership trying to cash out, or will it provide funding for factory and node upgrades?
Note: the space-grade Perseverance rover that landed on Mars a few weeks ago uses space-grade RAD750, built from a 150nm node.
en.wikipedia.org/wiki/RAD750
There's PLENTY of business at the lower-tech side of things. Just because GloFo doesn't have any timeline for 7nm or lower doesn't mean that they're dead. It just means that they're probably picking up designs like the RAD750.
More capacity of 12LP+ is obviously great for everyone right now, since it's still a high-end, relatively modern node - but we cannot afford for GF to give up on competing with Samsung, Intel, and TSMC. Intel doesn't share which would matter if Intel could make anything 10nm right now, and the Samsung TSMC duopoly isn't working out so great at the moment....
GF needs more money. Maybe if they IPO successfully, they will have the money they need to start the R&D process once more. But short term / near term, it doesn't seem like them competing vs TSMC / Samsung is going to lead to profits of any kind.
Current plans are for GF to IPO in 2022 or so. Giant investments (like supporting a newer advanced node) would probably wait until then...
It's worth noting that their 12/14nm is significantly better \ more dense than all of the other so-called 12/14/16nm nodes, except Intel 14nm, where they are close to parity. It's a perfectly suitable node for all kinds of SoCs, GPUs, chipsets and so on.
To put this in comparison, 20x0 Nvidia cards were made on TSMC 12nm with a density of 24.7MT/mm2. GloFlo's 12LP is about 36MT/mm2, or about 50% more dense.
I know that both Vega and the RX590 were both tuned to run on the 12LP+ process and the chip design tweaked specifically to get higher clocks, both with disappointing results.
GF's 12LP+ basically craps out beyond 1.5GHz no matter how much the design is tuned for it.
Like you say though, there are plenty of mainstream products outside of flagships that could certainly be made to work extremely well on 12LP+