Am I Next? GlobalFoundaries discontinues competing on advanced technology chips.

Sometimes the only way to win is to not play the game. It appears that the Santa Clara, California-based GlobalFoundaries, a manufacturer of semiconductor chips cannot keep up with competition and has announced the discontinuance of its next-generation chips. As a consequence of this shift in strategy, the company will lay off up to 900 employees worldwide and up to 170 at its Malta, New York manufacturing facility.

GlobalFoundries said back on June 11 that it would target 5 percent of its total global workforce of 18,000 people for layoffs this month as part of a move to better compete with its rivals. Worldwide that would mean about 900 people, or about 170 people at Fab 8, which has 3,400 employees. 

“In the coming weeks, we will be initiating a targeted workforce reduction specifically designed to improve our global cost structure and minimize redundancies that have accrued from previous mergers and acquisitions. This limited action will impact approximately 5 percent of our global headcount, with a significant portion expected to come from a voluntary separation program. The program is part of a companywide initiative to improve the competitiveness of our cost structure relative to industry peers. A workforce reduction is challenging for any organization and we do not take this action lightly. We are confident that these changes will position us to build a solid foundation for sustainable growth and continue investing for the future.” 

In jargon-filled corporate-speak…

"GLOBALFOUNDRIES today announced an important step in its transformation, continuing the trajectory launched with the appointment of Tom Caulfield as CEO earlier this year. In line with the strategic direction Caulfield has articulated, GF is reshaping its technology portfolio to intensify its focus on delivering truly differentiated offerings for clients in high-growth markets." 

"GF is realigning its leading-edge FinFET roadmap to serve the next wave of clients that will adopt the technology in the coming years. The company will shift development resources to make its 14/12nm FinFET platform more relevant to these clients, delivering a range of innovative IP and features including RF, embedded memory, low power and more. To support this transition, GF is putting its 7nm FinFET program on hold indefinitely and restructuring its research and development teams to support its enhanced portfolio initiatives. This will require a workforce reduction, however a significant number of top technologists will be redeployed on 14/12nm FinFET derivatives and other differentiated offerings." 

"GF is intensifying investment in areas where it has clear differentiation and adds true value for clients, with an emphasis on delivering feature-rich offerings across its portfolio. This includes continued focus on its FDXTM platform, leading RF offerings (including RF SOI and high-performance SiGe), analog/mixed signal, and other technologies designed for a growing number of applications that require low power, real-time connectivity, and on-board intelligence. GF is uniquely positioned to serve this burgeoning market for “connected intelligence,” with strong demand in new areas such as autonomous driving, IoT and the global transition to 5G." 

“Lifting the burden of investing at the leading edge will allow GF to make more targeted investments in technologies that really matter to the majority of chip designers in fast-growing markets such as RF, IoT, 5G, industrial and automotive,” said Samuel Wang, research vice president at Gartner. “While the leading edge gets most of the headlines, fewer customers can afford the transition to 7nm and finer geometries. 14nm and above technologies will continue to be the important demand driver for the foundry business for many years to come. There is significant room for innovation on these nodes to fuel the next wave of technology.”  <Source

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