Globalfoundries Lands First Major Customer: STMicro

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When AMD made the gutsy move of partnering with Middle Eastern investors and spinning off its fabrication facilities into their own company dubbed Globalfoundries, the industry was more than a little skeptical. Sure, Globalfoundries would be able to count on chipmaker AMD as a reliable customer, but the new operation was going to need more than AMD’s business to stay alive. Today, Globalfoundries took a major step in that direction, announcing it has partnered with Switzerland’s StMicroelectronics to produce 40nm chips for use in a variety of wireless devices, consumer electronics, and other products.

“When we launched Globalfoundries, our long-term vision was to bring a new business model to the foundry market and to become the partner of choice for the largest and most innovative semiconductor design and manufacturing companies,” said Globalfoundries CEO Doug Grose, in a statement. “With the addition of an industry-leader in low-power technology like STMicroelectronics we now begin to deliver on this vision.”

Industry watchers had expected Globalfoundries to aggressively pursue a manufacturing deal with the already-fabless chipmaker Nvidia, but in many ways STMicro is an even better partner, even if the company doesn’t have as high a public profile. STMicro is a large integrated company with its own fabs, and ranks as the fifth largest chipmaker on the planet (behind Intel, Samsung, Toshiba, and Texas Instruments). The company designs and manufacturers chipsets and microcomponents for everything from cars to printers and power supplies, as well, as communications gear, memory, consumer electronics, and computer gear. STMicro had revenue of almost $10 billion in 2008, over twice that of Nvidia. Globalfoundries 40nm process is no doubt appealing to STMicro, since other fabrication companies have been struggling with getting acceptable yields on 40nm parts.

Globalfoundries anticipates first tape out and production of STMicro products next year out of Globalfoundres’ German facilities; Globalfoundries also just broke ground on a new facility in upstate New York that should be online in 2012.

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