GlobalWafers Co (環球晶圓), the world’s third-largest silicon wafer supplier, yesterday said it is to receive US$406 million in subsidies from the US Department of Commerce for two new US fabs under the CHIPS and Science Act, with the first batch of the funds likely coming next year.
The grant represents 10 percent of the planned investments of US$4 billion in advanced semiconductor wafer manufacturing facilities in Texas and Missouri, GlobalWafers said.
The commerce department is to disburse the funds based on the completion of project milestones over a multiyear timeframe, the company said.
Photo: CNA
Along with the tax credit, which is equal to 25 percent of the qualified investment, the total government funding would make up 35 percent of GlobalWafers’ investments in the US, it said.
The company plans to build a new 12-inch silicon facility in Sherman, Texas, and a new 12-inch silicon on insulator (SOI) wafer plant in St Peters, Missouri, via its subsidiaries GlobalWafers America and MEMC LLC.
GlobalWafers said that it has received orders that would take up 80 percent and 90 percent of the capacities of the Texas and Missouri fabs respectively.
Starting in the first half of next year, GlobalWafers America would become the first high-volume advanced 12-inch silicon wafer facility in the US, the company said.
MEMC is also slated to start manufacture 12-inch silicon-on-insulator wafers in the first half of next year, it added.
“As we plan to achieve the first milestone in the first half of next year, we have an opportunity to receive the first CHIPS Act funding by the end of next year, if everything progresses smoothly,” GlobalWafers chairwoman Doris Hsu (徐秀蘭) told a virtual media briefing yesterday.
The US government funding would “greatly help” mitigate the company’s financial pressure and drive down the depreciation costs of the new facilities and manufacturing equipment, Hsu said.
GlobalWafers is facing mounting financial pressure with its capital expenditures and depreciation costs forecast to peak this year and next year, she said.
The company expects to see a significant improvement in gross margins in 2026 versus next year, as well as a better equipment loading rate and relatively healthier inventory on the semiconductor market, Hsu said.
Amid growing concern that US president-elect Donald Trump could scrap the CHIPS Act when he takes office next month, GlobalWafers said it believes the US government would uphold the law and that no major changes would occur as Washington has a good track record of living up to its promises.
With the new advanced wafer factories in the US, GlobalWafers said it would have a competitive edge over its rivals, given no tariffs, shorter-distance transportation costs and low carbon emissions.
“Our target is to have our wafers certified at all silicon wafer consumers in the US,” Hsu said.
“Starting next year and for the first time in over 20 years, the US will again be home to advanced wafers for leading-edge integrated circuits. Our new facilities will fill a key vulnerability in the US supply chain and bring back to American shores the technology that was pioneered here over 60 years ago,” GlobalWafers president Mark England said in a statement yesterday.
“As the only global wafer manufacturer participating in the CHIPS for America Program, we are fully committed to supporting the nation’s semiconductor manufacturing rebirth,” he said.
Hon Hai Precision Industry Co (鴻海精密) yesterday said that its research institute has launched its first advanced artificial intelligence (AI) large language model (LLM) using traditional Chinese, with technology assistance from Nvidia Corp. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), said the LLM, FoxBrain, is expected to improve its data analysis capabilities for smart manufacturing, and electric vehicle and smart city development. An LLM is a type of AI trained on vast amounts of text data and uses deep learning techniques, particularly neural networks, to process and generate language. They are essential for building and improving AI-powered servers. Nvidia provided assistance
STILL HOPEFUL: Delayed payment of NT$5.35 billion from an Indian server client sent its earnings plunging last year, but the firm expects a gradual pickup ahead Asustek Computer Inc (華碩), the world’s No. 5 PC vendor, yesterday reported an 87 percent slump in net profit for last year, dragged by a massive overdue payment from an Indian cloud service provider. The Indian customer has delayed payment totaling NT$5.35 billion (US$162.7 million), Asustek chief financial officer Nick Wu (吳長榮) told an online earnings conference. Asustek shipped servers to India between April and June last year. The customer told Asustek that it is launching multiple fundraising projects and expected to repay the debt in the short term, Wu said. The Indian customer accounted for less than 10 percent to Asustek’s
‘DECENT RESULTS’: The company said it is confident thanks to an improving world economy and uptakes in new wireless and AI technologies, despite US uncertainty Pegatron Corp (和碩) yesterday said it plans to build a new server manufacturing factory in the US this year to address US President Donald Trump’s new tariff policy. That would be the second server production base for Pegatron in addition to the existing facilities in Taoyuan, the iPhone assembler said. Servers are one of the new businesses Pegatron has explored in recent years to develop a more balanced product lineup. “We aim to provide our services from a location in the vicinity of our customers,” Pegatron president and chief executive officer Gary Cheng (鄭光治) told an online earnings conference yesterday. “We
LEAK SOURCE? There would be concern over the possibility of tech leaks if TSMC were to form a joint venture to operate Intel’s factories, an analyst said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday stayed mum after a report said that the chipmaker has pitched chip designers Nvidia Corp, Advanced Micro Devices Inc and Broadcom Inc about taking a stake in a joint venture to operate Intel Corp’s factories. Industry sources told the Central News Agency (CNA) that the possibility of TSMC proposing to operate Intel’s wafer fabs is low, as the Taiwanese chipmaker has always focused on its core business. There is also concern over possible technology leaks if TSMC were to form a joint venture to operate Intel’s factories, Concord Securities Co (康和證券) analyst Kerry Huang (黃志祺)