Intel plans to declare on Monday a $3.5 billion investment to upgrade its New Mexico fab, boosting the US chip-making plant. It will spend around $20 billion to develop two new facilities in Arizona. It is a part of a major effort by the chipmaker to refurbish its manufacturing.
The company confirmed the $3.5 billion upgrade, first reported on CBS’ 60 Minutes on Sunday. Intel manufacturing Chief Keyvan Esfarjani plans to analyze the plan at a press conference with New Mexico Gov. Michelle Lujan Grisham, New Mexico’s two senators, Ben Ray Lujan, Rep. Teresa Leger Fernandez, and Martin Heinrich.
The company is satisfied with the current efforts to raise federal funding to help the US chip industry.
Moreover, Gelsinger said Intel will invest more of its capital, too, instead of spending it on purchasing its shares. It is a move that keeps shareholders happy but that doesn’t help research or operations.
He also stated- We will not be anywhere near as focused on buybacks going forward as we have in the past. That’s been reviewed as part of my coming into the firm, agreed upon with the board of directors.
For decades Intel led chip making progress but fell behind TSMC (Taiwan Semiconductor Manufacturing Co) recently.
The new plant which Intel is thinking to invest in is Fabs. It is a part of a major Intel effort to restore its competitiveness under the lead of its new Chief executive, Pat Gelsinger.
In addition, it is also preparing to develop chips for others, a business called a foundry. And to rely on other chip foundries to build some of its chips.
The company also faces a smaller Arm rival called RISC-V, which won interest from some notable chip startups.
The TSMC is already spending billions of dollars on its new fabs, too, mostly in Taiwan but also in Arizona. Gelsinger said: “We believe it is going to take us a few years and we will be caught up, told to 60 minutes.