Struggling US chip maker Intel on Friday pushed out the timeline for completing two new fabrication plants in Ohio, saying it is taking a prudent approach to the $28 billion project.
Chip production originally slated to begin in 2025 at Intel’s first new “fab” in decades is now expected to start in 2030, Intel said in a statement.
“It’s important that we align the start of production of our fabs with the needs of our business and broader market demand,” Intel Foundry Manufacturing general manager Naga Chandrasekaran said in a message to employees shared by the company.
“We will continue construction at a slower pace, while maintaining the flexibility to accelerate work and the start of operations if customer demand warrants.”
As the US chip giant struggles to establish a foothold in the artificial intelligence revolution, Intel reported a net loss of $18.8 billion for the entire year 2024.
Asian giants TSMC and Samsung, who control the made-to-order semiconductor market, have overtaken Intel, one of Silicon Valley’s most recognizable corporations.
The growth of graphics chip manufacturer Nvidia as the leading supplier of AI chips worldwide also took the firm by surprise.
After the board lost faith in Intel CEO Pat Gelsinger’s ability to turn the firm around, he was fired in December.
His abrupt departure came just months after the company vowed to cut more than 15,000 jobs in a draconian cost reduction plan and paused or delayed construction on several chipmaking facilities.
Former US president Joe Biden’s administration last year finalized a $7.9 billion award to Intel as part of an effort to bring semiconductor production to US shores.
However, Intel announced late last year that it was postponing its plans to construct two massive chip-making facilities in Germany and Poland because of lower-than-expected demand.
Additionally, Intel announced at the time that it would reduce its Malaysian initiatives.
