Qualcomm and GlobalFoundries sign billion-euro chip production deal

Qualcomm and GlobalFoundries sign billion-euro chip production deal

GlobalFoundries and Qualcomm extended their cooperation. GlobalFoundries’ will produce chips for Qualcomm until at least 2028. According to the organizations, the deal is worth billions of euros.

GlobalFoundries is a foundry. Foundries invest in factories and equipment to produce customers’ chip designs. GlobalFoundries, Samsung and TSMC are among the world’s largest foundries.

Qualcomm designs chips for smartphones, network equipment and car parts. The organization draws up blueprints and partners with foundries to produce chips at scale. Qualcomm and GlobalFoundries have collaborated for years. The latest contract extends the collaboration until at least 2028.

GlobalFoundries and Qualcomm

The deal has several results. First, Qualcomm will receive more manufacturing capacity in an upcoming GlobalFoundries plant in Crolles, France. In addition, GlobalFoundries will free capacity for Qualcomm’s 5G chips at its Singapore plants.

In return, GlobalFoundries will compensate Qualcomm. The organizations described the contract as a “multi-billion dollar revenue agreement”, but beyond that, financial details are unknown.

Chips and Science Act

GlobalFoundries is active worldwide. In addition to France and Singapore, the organization has a manufacturing location in New York. Qualcomm will be an important regional customer. GlobalFoundries CEO Thomas Caulfield said the cooperation will benefit North America’s footprint on the global market.

The announcement’s timing coincides with the arrival of the Chips and Science Act. The bill was approved by the US Congress last month. The regulation makes $52 billion in subsidies available for chip manufacturing in the United States. In addition, investors of chip plants are eligible for billions of dollars in tax breaks.

The bill is an opportunity for organizations like GobalFoundries and Qualcomm. The subsidies entice manufacturers and designers to produce on US soil. Earlier this year, the European Commission introduced the EU Chips Act, a similar bill for the European Union. Europe became more attractive. That’s why GlobalFoundries and Qualcomm opted for expansions in both Europe and the United States.

In addition to Qualcomm, GlobalFoundries collaborates with Intel. GlobalFoundries and Intel also recently announced expansions in Europe and the United States. The organizations want to benefit from subsidies and tax breaks in both regions.

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