Qualcomm spends $4.2 billion to buy GF chips

Recently, according to media reports, Qualcomm has agreed to purchase an additional $4.2 billion worth of semiconductor chip foundry business from GF's New York factory, bringing its total purchase commitment to $7.4 billion by 2028. Prior to this, Qualcomm and GF had reached a $3.2 billion purchase agreement. Under the agreement, GF will produce chips for Qualcomm for 5G transceivers, Wi-Fi, automotive and IoT connectivity.

It is understood that GF currently has three chip manufacturing bases in the United States, one is located in Malta, New York, and the other two are located in Burlington, Vermont and East Fishkill, New York.

Dr. Roawen Chen, Senior Vice President and Chief Supply Chain Officer and Operating Officer of Qualcomm, said: "As demand for 5G, automotive and IoT applications accelerates, a robust supply chain is essential to ensure continued innovation in these areas. We Continued collaboration with GF will help expand innovation in next-generation wireless as we move toward a world where everything is smart and connected."

In recent years, with the layout of GF's diversified process technology, it has reached a good cooperative relationship with Qualcomm. In 2021, Qualcomm's subsidiary signed a long-term contract with GF to manufacture components at GF's plant in Dresden, Germany. Since then, the partnership will expand to include leveraging additional capacity at GF's Croll fab in France, as well as the production of 8SW RF silicon-on-insulator technology for mid-band 5G communications at its Singapore facility.

Also, as the European Union eases rules on financing innovative semiconductor factories to boost its chip industry and reduce reliance on U.S. and Asian suppliers. Currently, Intel and GF have announced expansion plans in the two continents to take advantage of government subsidies. GF has reached a partnership with STMicroelectronics to invest $5.7 billion to build a semiconductor factory in France.

In terms of revenue alone, GF is already the third largest foundry company in the world, after TSMC and Samsung Electronics, but if Samsung is excluded from the foundry business that produces chips for its Korean sister company, GF's ranking can rise to second.