Intel, U.S. Department of Commerce sign PMT for up to $8.5B in CHIPS Act funding

The Biden-Harris Administration announced that Intel and the U.S. Department of Commerce have signed a non-binding preliminary memorandum of terms, or PMT, for up to $8.5B in direct funding to Intel for commercial semiconductor projects under the CHIPS and Science Act. CHIPS Act funding aims to increase U.S. semiconductor manufacturing and research and development capabilities, especially in leading-edge semiconductors. Intel is the only American company that both designs and manufactures logic chips. The proposed funding would help advance Intel’s semiconductor manufacturing and research and development projects at its sites in Arizona, New Mexico, Ohio and Oregon, where the company develops and produces many of the world’s most advanced chips and semiconductor packaging technologies. Together, the CHIPS Act proposed funding and Intel’s previously announced plans to invest more than $100B in the U.S. over five years constitute one of the largest public-private investments ever made in the U.S. semiconductor industry. The investment will create thousands of new company positions and construction jobs, foster U.S.-based R&D and strengthen U.S. supply chains. Under the PMT, Intel would also have the option to draw upon federal loans of up to $11B. Intel also plans to claim the U.S. Treasury Department’s Investment Tax Credit, or ITC, which is expected to be up to 25% of qualified investments of more than $100B over five years. The PMT provides that the direct funding award and federal loans are subject to due diligence and negotiation of a long-form term sheet and award documents, and are conditional on the achievement of certain milestones and remain subject to availability of funds. In addition to its significant investments to expand U.S. manufacturing capacity, Intel is on track to deliver five semiconductor process nodes in four years and expects to return to process technology leadership by 2025 with Intel 18A. Intel recently announced an extended process technology roadmap that adds the more-advanced Intel 14A to the company’s node roadmap, in addition to several specialized node evolutions. Intel is dedicated to advancing U.S. efforts to regain its leadership position in this vital industry through its investments to expand chipmaking capabilities and capacity. CHIPS Act proposed funding would support Intel’s investments in Arizona, the Silicon Desert; New Mexico, the Silicon Mesa; Ohio, the Silicon Heartland; and Oregon, the Silicon Forest.