July 30, 2009 GlobalFoundries names first new customer Staff and wire reports
SUNNYVALE, Calif. - GlobalFoundries revealed Wednesday the identity of its first non-AMD customer, citing the deal as proof of the fledgling firm's viability.
Under the terms of the deal, GlobalFoundries will begin making computer chips next year for STMicroelectronics, the world's fifth-largest semiconductor company and the largest such firm in Europe..
"When we launched the brand back in March, we said our number one goal this year was to land that first non-AMD customer," said GlobalFoundries spokesman Travis Bullard. "This is a huge step for us and I think a lot sooner than most people expected.".
Though GlobalFoundries refused to divulge specifics of the agreement, including the number of computer chips to be produced or the dollar figure involved, Bullard said he expects the deal to benefit Fab 2, the $4.2 billion manufacturing facility being built in Malta, N.Y..
Initially, though, the STMicroelectronics computer chips will be manufactured at GlobalFoundries' facility in Dresden, Germany. That factory is called Fab 1..
"Certainly, as we look to bring on Fab 2 and get it into manufacturing operation and volume production in 2012, we certainly look to be producing some of the products with the addition of the New York capacity, as well," Bullard said on Wednesday. .
STMicroelectronics is based in Switzerland and had net revenue of $9.84 billion in 2008, according to the company's Web site..
The company hasn't been immune to the overall downturn in the computer chip industry and a reported second-quarter loss on Tuesday of $318 million, or 36 cents per share, compared with a loss of $47 million, or 5 cents per share, in the same period of 2008. Revenue for the quarter fell 17 percent to $1.99 billion from $2.39 billion..
The company's shares trade under the ticker STM, and its Web site is located at www.st.com..
According to the Web site, the company makes microchips for a range of electronic devices, including cell phones, digital television sets, digital audio components, game controllers and set-top cable TV boxes. About 15 percent of the firms' chips are used by the automotive industry. .
Under the deal announced Wednesday, GlobalFoundries will use its "40 nm LP chipmaking process" to meet STMicroelectronics' needs..
"To ensure ample capacity for our customer/partners at the leading-edge of low-power design, ST needs an agile and high-performance manufacturing partner that can adapt to our changing needs," said Jean-Marc Chery, executive vice president and chief technology officer for STMicroelectronics, in a prepared statement. "With a strong commitment to manufacturing and technology excellence at the leading edge, we believe GlobalFoundries is an excellent partner to collaborate on low-power design innovation in 2010 and beyond.".
GlobalFoundries began construction of Fab 2 on Friday. The company was created earlier this year when Advanced Micro Devices, the world's second-largest computer chip manufacturer, spun off its manufacturing operations into a joint venture with Advanced Technology Investment Co., an investment firm funded by the Abu Dhabi government..
GlobalFoundries' business plan is to become a manufacturing resource for any computer chip company that requires manufacturing capacity, though AMD was -- until the STMicroelectronics deal -- the firm's only customer.
