Dive Brief:
- Semiconductor manufacturer Applied Materials is focused on expanding its production and R&D operations, CFO Brice Hill said during the company’s Q1 earnings call on Feb. 16.
- The investment is one of the company’s top spending priorities, as well as increased investments in logistics and manufacturing capabilities, the CFO noted on the call.
- Looking ahead, the scale, speed and location of these investments will depend on government support, President and CEO Gary Dickerson noted on the call.
Dive Insight:
Applied Materials first announced its expansion strategy in December, with a multi-billion plan to increase its manufacturing capacity throughout the rest of the decade.
“Semiconductors are the foundation of the digital economy making them more strategically and economically important than ever before,” Dickerson told investors. “Around the world, governments are incentivizing the industry to build regional manufacturing capacity and accelerate investments in strategic next-generation technologies.”
Last year, the company secured $30 million from California to help build an R&D facility in Silicon Valley. The company expects to break on the facility later this year, Dickerson said on the call.
In exchange for the grant, the company must create a minimum of 683 full-time jobs and invest $2 billion to develop next-generation semiconductor manufacturing equipment, according to a press release.
The company is also expanding its facilities in Austin, Texas. Applied Materials is expected to invest about $150 million in operations at the site, with $100 million going toward a new 724,000-square-foot warehouse facility, according to state records. It plans to spend another $27 million to upgrade the existing facilities.
In December, the company launched an expansion plan for Singapore, including the expansion of its regional hub and increased R&D investments.
“As the industry and Applied Materials scale, we need to do so productively and efficiently,” Dickerson said on the Feb. 16 call. “This is a major strategic theme for us and, across the company, we are focused on driving up productivity and implementing new ways to work that are better and faster.”
