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Qualcomm to buy chips from GlobalFoundries for additional $4.2 billion
According to a document released on Monday, Qualcomm agreed to purchase an additional value of 4.2 billion from the semiconductor foundry company GlobalFoundries New York factory of semiconductor chips, which brings its total purchases to 7.4 billion US dollars by 2028.
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The additional purchase deal expands on an earlier $3.2 billion agreement between Qualcomm and GlobalFoundries to collaborate on the production of chips for 5G transceivers, WiFi, automotive, and IoT connectivity. According to a press release issued by GlobalFoundries, Qualcomm is one of the company’s first customers to sign a long-term agreement in 2021, covering multiple regions and multiple technologies.
GlobalFoundries CEO Thomas Caulfield said in a statement that for the company’s upstate New York factory, having a long-term customer like Qualcomm, plus funding from the U.S. federal and state governments, will make Helps expand the company’s U.S. manufacturing operations.
The U.S. Senate last month passed sweeping legislation to subsidize the U.S. domestic semiconductor industry, including about $52 billion in government subsidies for semiconductor production and investment taxes for chip factories estimated to be worth up to $24 billion. Senate Majority Leader Chuck Schumer said: “As the federal government provides significant new incentives for the U.S. microchip manufacturing industry, I look forward to more similar policies in the future.”
At the same time, the European Union has also eased financing rules for innovative semiconductor factories to boost its chip industry and reduce its reliance on U.S. and Asian suppliers. In order to take advantage of these subsidies, Intel and GlobalFoundries have announced expansion plans in the European and American markets. The latter will cooperate with STMicroelectronics to invest $5.7 billion to build a semiconductor factory in France.
News of Qualcomm’s expanded purchase agreement comes as the heads of GlobalFoundries, Applied Materials, and automakers Ford and General Motors will hold a closed-door summit with U.S. government officials on Monday to discuss government investment in semiconductors. plan.
GlobalFoundries is the world’s third-largest chip foundry by revenue, after TSMC and Samsung Electronics, but it ranks second if Samsung’s foundry business, which produces chips for the company’s other businesses, is excluded. GlobalFoundries, majority-owned by Abu Dhabi’s sovereign wealth fund Mubadala Investment Co, raised $2.6 billion in its Nasdaq IPO (initial public offering) last year.