**GlobalFoundries Confirms CHIPS Act Funding Remains Strong**
GlobalFoundries has reaffirmed that its funding under the CHIPS Act is “well intact,” clarifying that the framework does not involve any equity arrangements. This statement comes shortly after the U.S. government acquired a 10% equity stake in Intel, raising concerns about the implications for corporate America. During the Deutsche Bank Technology Conference, CFO John Hollister explained that the company is receiving government support based on the completion of specific milestones outlined in the act.
The recent government investment in Intel, along with a notable agreement with Nvidia and AMD to allocate 15% of revenue from advanced chip sales in China to the government, indicates a significant increase in federal involvement in corporate operations. Unlike Intel’s arrangement, which converted CHIPS Act grants into equity, GlobalFoundries maintains a different approach under the act.
Signed into law by President Joe Biden in 2022, the CHIPS Act aims to enhance semiconductor manufacturing in the U.S. and counteract China’s influence in the sector. Former President Trump had previously expressed intentions to modify certain conditions of the act, claiming they did not align with his executive orders. Each recipient of the funding has unique terms and milestones to meet.
GlobalFoundries’ framework under the CHIPS Act focuses on expanding capacity across its fabrication plants. Earlier this year, the company announced an increase in its investment plans to $16 billion, which includes an additional $1 billion for capital expenditures and $3 billion for research in emerging chip technologies. CFO Hollister noted that this investment strategy is designed to support over a decade of spending.
In conclusion, GlobalFoundries is poised to leverage its CHIPS Act funding to enhance its manufacturing capabilities while maintaining a clear distinction from equity-based arrangements seen in other corporate deals.
**FAQ**
**What is the CHIPS Act?**
The CHIPS Act is a U.S. law aimed at boosting semiconductor manufacturing and production to strengthen the domestic supply chain and reduce reliance on foreign sources, particularly from China.