MACOM Unveils Ambitious $345 Million Investment in Facilities

MACOM Launches Major Investment Initiative

MACOM Technology Solutions Holdings, Inc. (Nasdaq: MTSI) has recently unveiled an exciting plan aimed at revitalizing its semiconductor wafer fabrication facilities located in the U.S. This extensive five-year strategy entails an impressive investment of up to $345 million, showcasing MACOM's commitment to enhancing its operational capabilities and industry standing.

Investment Support and Funding Details

The ambitious investment plan is bolstered by a preliminary, non-binding agreement with the CHIPS Program Office, which opens the door for direct funding from the U.S. Department of Commerce under the CHIPS and Science Act, projected to reach $70 million. Furthermore, the initial terms suggest a potential total support of around $180 million through a mix of federal funding, investment tax credits, and state-level assistance. Notably, this includes a direct funding contribution of up to $15.7 million from the Massachusetts Technology Collaborative.

Self-Funding Projections

The remaining balance, indicated to be approximately $165 million, is expected to be financed through MACOM's operating cash flow over the next five years. This strategic financial roadmap illustrates MACOM's confidence in its operational efficiency and growth trajectory.

Strategic Manufacturing Enhancements

The proposed capital investment is designed to reinforce MACOM's growth roadmap, positioning the company as a premier supplier of cutting-edge RF, microwave, and millimeter-wave semiconductor technologies. This strategic initiative will not only enhance production capabilities but also support both existing and emergent market demands in Defense, Telecommunications, and Datacenter sectors.

Key Features of Investment Plans

With careful planning, MACOM aims to upgrade its Massachusetts wafer fabrication facility through several key enhancements:

• Expansion of clean room facilities within the current building.
• Modernization of existing 100mm production lines utilizing GaAs, GaN, and Silicon materials.
• Introduction of 150mm GaN-on-SiC manufacturing capabilities for advanced applications.
• Significant infrastructure upgrades to HVAC, water systems, solar, and power.

Meanwhile, the North Carolina facilities will also see substantial improvements, including:

• Clean room expansions tailored to the current building’s layout.
• Implementation of 150mm wafer size production capabilities to enhance RF GaN-on-SiC processes.
• Installation of advanced MOCVD technologies for epitaxial growth.
• Upgrades to critical infrastructure such as HVAC and water systems.

MACOM's Vision for the Future

Stephen G. Daly, President, and CEO of MACOM, emphasized the significance of this investment, stating, “This plan will strengthen MACOM's domestic semiconductor manufacturing capabilities, accelerate our growth strategy, and enable us to service our customers more effectively using leading technologies.”

Furthermore, MACOM is committed to collaborating with the CHIPS Program Office to finalize a definitive agreement that will solidify this investment, laying the groundwork for future advancements in semiconductor technology.

Understanding the CHIPS Initiative

CHIPS for America plays a crucial role in this initiative, having allocated over $33 billion out of a total proposed funding of more than $36 billion. This initiative aims to stimulate job creation and bolster the semiconductor sector across the nation. Since the Biden-Harris administration took office, nearly $450 billion in private investment has been injected into semiconductor and electronics firms, highlighting the sector's growing importance in the U.S. economy.

About Massachusetts Technology Collaborative

The Massachusetts Technology Collaborative (MassTech) is a vital public agency dedicated to advancing technology and enhancing regional competitiveness. By fostering investments and partnerships, MassTech strengthens the state's tech economy while driving innovation and supporting diverse industry sectors.

About MACOM Technology Solutions

MACOM is a leading player in the semiconductor industry, designing and producing high-performance products tailored for Telecommunications, Industrial applications, Defense, and Datacenter markets. With a broad product portfolio that includes RF, Microwave, Analog, and Optical technologies, MACOM serves over 6,000 customers annually. The company is certified to the IATF16949 automotive standard, ISO9001 quality standard, and ISO14001 environmental management standard.

Headquartered in Lowell, Massachusetts, MACOM operates facilities across the United States, Europe, and Asia, showcasing its global reach and commitment to innovation.

Frequently Asked Questions

What is MACOM's recent investment plan?

MACOM has announced a strategic investment of up to $345 million to modernize its semiconductor wafer fabrication facilities.

How will the CHIPS Program Office support MACOM's initiative?

The CHIPS Program Office may provide up to $70 million in funding as part of MACOM's investment plan.

What technologies will be enhanced through this investment?

MACOM's investment will upgrade technologies related to RF, microwave, and millimeter-wave semiconductor capabilities.

What is the expected self-funding amount for the investment?

Approximately $165 million of the investment is projected to be self-funded through MACOM's operating cash flow.

Where is MACOM headquartered?

MACOM is headquartered in Lowell, Massachusetts, and operates facilities globally.

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