Intel (INTC) unveiled plans Friday to invest $20 billion into two chipmaking plants in Ohio that it hopes have have up-and-running within three years as it expands domestic production ahead of a meeting with White House officials.
Intel, which detailed a similar investment in Arizona last March, said the Ohio investment will create 3,000 jobs -- with another 7,000 needed to build the two plants -- and expand the group's plans to take-on rivals such as Samsung and Taiwan Semi TSMC in the global semiconductor market.
The plans also dovetail with President Joe Biden's ambitions for a $52 billion bill that would help U.S. chipmakers expand domestic production levels and reduce their dependence on overseas markets for crucial components in the nation's industrial and tech supply chain.
"Intel is bringing leading capability and capacity back to the United States to strengthen the global semiconductor industry," said CEO Pat Gelsinger, who will meet with President Biden at the White House on Friday. "These factories will create a new epicenter for advanced chipmaking in the U.S. that will bolster Intel’s domestic lab-to-fab pipeline and strengthen Ohio’s leadership in research and high tech.”
Intel shares were marked 1% higher in early trading Friday to change hands at $52.60 each, a move that would trim the stock's six-month decline to around 6.5%.
Gelsinger, who replaced interim CEO Bob Swan in February of last year, has moved quickly to shift Intel's focus on chipmaking scale while extracting profits from the group's prior investments.
Last month, Intel said it would list Mobileye, the Israel-based self-driving car division it purchased for $15.3 billion in 2017, in a deal that could provide a cash infusion of up to $50 billion.
Intel will publish its fourth quarter earnings on January 26, with investors looking for a bottom line of 91 cents per share on revenues of $18.32 billion.
Intel's posted weaker-than-expected third quarter earnings of $1.71 per share in late October, on sales of $18.1 billion, adding that its newer, faster chips would be less profitable in the early phase of their release and cautioning that profit margins would fall to between 51% and 53% over the next three years.
