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Globalfoundries, a leading contract maker of semiconductors controlled by Advanced Technology Investment Company and Advanced Micro Devices, plans to become the world's second largest foundry by revenue already this year and boost its revenue by 14% to $4 billion in 2011, its chief executive officer said on Tuesday.

Thanks to increasing orders from new clients, Globalfoundries wants to increase its earnings from around $3.5 billion in 2010 to approximately $4 billion in calendar 2011 and, leave behind United Microelectronics Corp. in terms of revenue and become the world's second largest contract maker of semiconductors. The company's strategy to boost its sales is rather simple: it aims to expand manufacturing capacity migrate faster to advanced process technology than other makers, said Doug Grose, chief executive of Globalfoundries, in an interview with Dow Jones Newswires.

The company's aggressive expansion plans are well known in the industry. In fact, the chipmaker will invest into expansion more than it plans to earn this year. Globalfoundries plans to spend whopping $5.4 billion on expansion of its current facilities as well as on building its new manufacturing facility in the state of New York, it transpired earlier this year. The capital spending of Globalfoundries in 2011 will be two times higher compared to capital expenditures in 2010.

Mr. Grose reportedly said the company would mass produce chips using 28nm high-k metal gate (HKMG) process technology in the second half of 2011, which is in line with TSMC's plans to start making chips using 28nm HKMG fabrication process and is ahead of UMC's plans to manufacturing at 28nm node in 2012.

The disruption of semiconductor manufacturing in Japan may help Globalfoundries to gain further orders.

"Our customers in Japan didn't cut orders for chips. The dialogue with our customers is 'can we help them (with) more?'," said Mr. Grose.

The company has more than 150 customers including AMD, Broadcom Corp., Qualcomm, STMicroelectronics, Renesas Electronics Corp. Infineon Technologies AG, Texas Instruments and others.

At the company's leading-edge Dresden manufacturing campus, Fab 1, the expansion focus will be on adding new capacity to support additional growth opportunities for 45/40/28nm technologies as well as initial 22nm development. This expansion will see a new facility constructed at Fab 1 that will add nearly 110 thousand square feet of clean room space to enable the site to scale output up to 80 thousand wafers per month over the next two years. To support long-term growth at the 22/20nm generation, Globalfoundries expanded the size of Fab 2's cleanroom to approximately 300 thousand square feet, which will enable a total output of approximately 60 thousand wafers per month once fully ramped. In addition to new expansion initiatives in Dresden and New York, Globalfoundries also has been expanding its Fab 7 in Singapore to reach an output level of 50 thousand wafers per month to manufacture technologies ranging from the 65nm to 40nm technology nodes. When all the new expanded facilities become fully operational, total Globalfoundries’ 300mm output will be around 190 thousand wafers per month.

Tags: Globalfoundries, AMD, ATIC, Business, Semiconductor, UMC, TSMC

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Discussion started: 05/02/11 04:53:31 PM
Latest comment: 05/02/11 04:53:31 PM

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Dear Xbit,

The terms "revenue" and "earnings" are ABSOLUTELY NOT interchangeable.

Sincerely,
The Financial Community
0 0 [Posted by: TurtleBay  | Date: 05/02/11 04:53:31 PM]
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