Japan funds GlobalFoundries fabs in New York

Japan will provide up to $21 billion to finance the construction of as many as two semiconductor factories in New York State that will be operated by GlobalFoundries (GFS). The project is structured so that Japan supplies the capital for the facilities, while GlobalFoundries is responsible for managing and running the plants. The factories are planned for New York’s Capital Region and are intended to expand U.S. chipmaking capacity.

This commitment is part of a broader U.S.-Japan investment arrangement under which Japan agreed to deploy roughly $550 billion in the United States. In return, the United States will lower tariffs on Japanese imports, linking the semiconductor initiative to wider trade and investment ties between the two countries.

GlobalFoundries and its partners plan to break ground on the first New York fab in 2026. Commercial chip production at this facility is expected in 2029, marking the key milestone when the investment begins to translate into output. A decision on whether to proceed with a second factory is scheduled to be made before the end of 2028, leaving room to adjust plans based on demand and project progress.

Once fully operational, the first fab is forecast to add about 900,000 300mm wafers of annual U.S. manufacturing capacity. The facility is also expected to create more than 1,000 factory jobs in New York’s Capital Region, highlighting the project’s role in supporting regional employment in advanced manufacturing.

As part of the agreements tied to this initiative, the U.S. government will receive approximately a 4% equity stake in GlobalFoundries. This will raise the U.S. government’s total ownership in the company to about 7%. The equity component aligns public-sector support with a direct financial interest in the chipmaker.

GlobalFoundries will operate and manage the new New York fabs and will earn fees from building and running the facilities. The company will also license chip-manufacturing technology to the project. Executives expect this operator role to generate fee income for at least 20 years, with fee revenue projected at about $50 million next year from managing construction of the first factory.

Initial customers identified for output from the new New York fabs include Renesas Electronics and Apple (AAPL). Their inclusion signals planned demand for the capacity that will be added once the first facility begins production.

In parallel with the new-build program, GlobalFoundries will reallocate $955 million of previously awarded U.S. CHIPS Act support. These funds will go toward investments in silicon photonics, silicon-germanium and advanced packaging at its existing sites in Malta, New York, and Burlington, Vermont. The combination of greenfield construction and upgrades to current facilities is intended to expand both capacity and technology capabilities within GlobalFoundries’ U.S. manufacturing footprint.