The largest chip-equipment maker in the world is building a new research-and-development center in the U.S.
Applied Materials
(ticker: AMAT) plans to invest up to $4 billion over the next seven years for an R&D innovation center in Silicon Valley.
“This investment presents a golden opportunity to re-engineer the way the global industry collaborates to deliver the foundational semiconductor process and manufacturing technologies needed to sustain rapid improvements in energy-efficient, high-performance computing,” Applied Materials CEO Gary Dickerson said in the Monday news release.
Applied Materials stock is down 0.6% to $126.19 in late afternoon trading Monday. The chip-equipment company’s key customers include
Intel
(INTC) and
Taiwan Semiconductor Manufacturing
(TSM).
The company said the new facility will have more than 180,000 square feet, the size of three football fields. It will offer space for research collaboration with chip makers and universities.
The innovation center is scheduled to be completed by early 2026, employing up to 1,500 construction workers and creating 2,000 new engineering jobs. The scale of the project will be contingent on receiving funds from the U.S. government through the CHIPS and Science Act, Applied Materials said. The company didn’t project the amount of potential funding it expected.
In 2022, President Joe Biden signed the CHIPS and Science Act, which included roughly $50 billion in funding to boost U.S. chip manufacturing.
Last week, Applied Materials reported better-than-expected earnings for its fiscal second quarter, but the shares fell after management said the memory-chip market remains difficult.
Write to Tae Kim at tae.kim@barrons.com
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