Japan Puts $21 Billion Behind Two GlobalFoundries Fabs in New York as US Takes a 7% Stake

Japan will invest up to $21 billion in two chip factories in New York state that will be jointly owned by US and Japanese interests and operated by GlobalFoundries, the company said on 14 October, marking Tokyo's first move into US semiconductor manufacturing under last year's deal to invest $550 billion in the American economy in exchange for lower tariffs on Japanese goods. Roughly $10 billion funds an already permitted 300mm fab expected to start production in 2029, with a further $10 billion covering a second plant the partners will decide on before the end of 2028. Each facility is projected to add around 900,000 to 1,000,000 300mm wafers a year of US capacity at full operation, placing them among the larger US fabs, with more than 1,000 manufacturing jobs and roughly 27,000 direct and indirect construction jobs expected.

Washington is taking equity alongside the capacity. In a separate agreement the Commerce Department will take a further 4% stake in GlobalFoundries, bringing total US government ownership to about 7%, chief executive Tim Breen told Reuters; the government had previously granted the company $1.63 billion, and President Trump put the value of the stake at more than $2 billion. GlobalFoundries will also amend an existing Chips Act award to reallocate $955 million, accelerating investment in silicon photonics, silicon-germanium and advanced packaging at its existing Malta, New York and Burlington, Vermont sites. The fabs are aimed at so-called essential chips for vehicles, industrial equipment and communications gear, a segment squeezed by the industry's pivot toward advanced AI accelerators.

The commercial structure is unusual. Japan supplies all the investment capital while GlobalFoundries contributes differentiated technology, operational capacity and customer relationships, and earns fees under the arrangement for at least 20 years; executives said those fees should be roughly $50 million next year for managing construction of the first fab. Initial customers are reported to include Japan's Renesas Electronics and Apple, with Breen saying priority will go to US and Japanese customers. GlobalFoundries shares rose about 5% to around $49 after the announcement, taking their gain this year to roughly 33% to 39%, with the company majority owned by Abu Dhabi's Mubadala Investment Company.

The project lands in an already tight equipment and construction pipeline. Industry group SEMI said on Wednesday that 20 new 300mm fabs are expected to break ground globally in 2026 and 18 more in 2027, with fab construction spending projected to jump 23% to $48 billion this year and a further 33% to $63 billion in 2027. Breen said at least some of the Japanese capital will flow back to equipment suppliers such as Tokyo Electron. GlobalFoundries separately agreed a $2 billion deal with TSMC about a week earlier covering US production of silicon interposers, the components that sit between AI processors and memory.