Japan is pouring up to $21 billion into two new New York semiconductor factories co-owned by the US government and Japanese entities, with GlobalFoundries managing operations.
Following Wednesday’s announcement, shares of the Malta-based chipmaker jumped over 4% in early trading, pushing its year-to-date gains past 33%.
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The funding stems from a $550 billion US investment pact brokered by the Trump administration last year.
In exchange, the US slashed tariffs on Japanese automobile and goods imports from 25% down to 15%.
Although Japan is supplying 100% of the project’s funding, the US government will retain an ownership stake in the new factories.
GlobalFoundries, which is majority-owned by Abu Dhabi’s Mubadala Investment Co., will generate revenue through construction management, operational fees, and tech licensing.
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Concurrently, the US government is acquiring a separate 4% equity stake in GlobalFoundries itself, elevating its total ownership in the chipmaker to roughly 7%, according to CEO Tim Breen.
Breen added that the firm will oversee client relations, securing Apple and Renesas Electronics as the initial marquee buyers for the upcoming New York facilities.
CEO Tim Breen noted that while the new plants will prioritize American and Japanese clients, they will eventually serve international buyers through a structured post-announcement allocation process.
This project belongs to a multi-phase Japanese investment initiative that has already committed over $100 billion across two waves of US projects.
Under the bilateral pact, President Donald Trump selects the ventures Japan bankrolls; future cash flows will initially be split 50/50 before shifting to a 90% payout in favor of the US.
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Furthermore, Breen highlighted that a portion of Japan’s multi-billion-dollar capital injection will cycle back into the local economy via equipment orders from major Japanese toolmakers like Tokyo Electron.
“We are highly motivated to involve Japanese equipment vendors,” Breen explained. “While we remain flexible, we plan to collaborate deeply with the Japanese tech sector to leverage their cutting-edge capabilities.”
