GlobalFoundries, the largest specialty chip foundry in the United States, announced on Wednesday (April 4) that it will invest up to $16 billion to expand its production and research and development in the U.S. This move reflects the surge in demand for artificial intelligence (AI) and supply chain security considerations, emphasizing continued collaboration with the Trump administration to foster the development of the U.S. semiconductor industry.

According to the latest statement from GlobalFoundries, the company will spend $13 billion to expand its existing factories in New York and Vermont, and an additional $3 billion for R&D in advanced packaging and other emerging technologies in the U.S. CEO Tim Breen mentioned that the plan does not have a detailed spending timeline and will be adjusted based on market supply and demand flexibility to meet customer needs.

Breen noted that customers are seeking more localized production to reduce reliance on specific regional suppliers, stating that “supply security is crucial,” particularly as demand for domestic production from U.S. customers has significantly increased over the past six months. He emphasized that the AI wave has driven demand for high-performance, low-power chips for data centers and communication devices, marking a strategic response to GlobalFoundries' expansion plans.

GlobalFoundries primarily produces key chips using what is known as “mature process technology,” which, while not the most advanced in the industry, is vital for power management and data flow control components and plays an essential role in emerging markets such as AI, electric vehicles, and quantum computing. The company stated that it will focus on areas including photon technologies, gallium nitride materials, and packaging technologies, which are becoming important strategic placements in the chip industry’s niche markets.

Headquartered in Malta, New York, GlobalFoundries originated from AMD's chip manufacturing division and merged with Chartered Semiconductor to become a global chip foundry operating across the U.S., Germany, and Singapore. The majority of the company's shares are currently held by the Abu Dhabi government.

Over the past five years, GlobalFoundries has averaged annual capital expenditures of about $1.4 billion, far below the hundreds of billions spent annually by Intel and Samsung for expansions. However, benefiting from the growth in AI and automotive electronics demand, GlobalFoundries has decided to ramp up its investment. Breen indicated that the additional $3 billion R&D budget will be allocated to three main areas: advanced chip packaging, silicon photonics technology for quantum computing processors, and gallium nitride technology for electric vehicles and other power management applications.

This new plan has gained support from key clients, including Apple, Qualcomm, and General Motors. President Trump views this as a testament to the success of his industrial policies and is actively promoting domestic supply chain initiatives in the U.S. Although the investment does not provide a specific execution timeline, analysts believe that with the continued rise in AI and geopolitical risks, GlobalFoundries’ strategic expansion will help strengthen the resilience of the U.S. semiconductor supply chain.