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Considering that AMD's flagship chips use GloFo i/o, this is a brilliant move. It will be interesting to see how the equity market absorbs these developments.

taspeotis 5y ago
It feels like AMD was already stepping away: https://www.anandtech.com/show/16677/amd-and-globalfoundries-update-wafer-share-agreement-through-2024 https://www.anandtech.com/show/16677/amd-and-globalfoundries... > AMD will see out its existing commitment to use GlobalFoundries through 2024, with the latest amendment setting purchase targets for 2022, 2023, and 2024. Beyond those new targets, however, the agreement releases AMD from all further exclusivity commitments to GlobalFoundries. AMD is now free to use any fab on any process node that it wants.
- totalZero 5y ago
  They traded exclusivity for a minimum order size. I'm not sure I would read that negotiation as setting a sunset date on their overall relationship at the end of 2024, and I definitely wouldn't read it as AMD being totally free prior to 2025. 1.6B is half a quarter's revenue for AMD. Milan has been a slam dunk; there's obviously some value over at GloFo for AMD, and it wouldn't be a no-tears breakup (hypothetically speaking). I don't dispute that GloFo's role in AMD's strategy will necessarily change if it becomes part of Intel.
coliveira 5y ago
Another reason why this deal should be blocked by the government. It is anticompetitiveness at its core.
- totalZero 5y ago
  If I were Intel and a deal were really in the works contingent on antitrust, I would argue that: (a) Intel is a distant third in fabrication and a merger with another also-ran would improve competitiveness against state-backed TSMC and the Samsung chaebol; (b) the severity of the demand creation in the market justifies an acquisition that streamlines existing players and makes them more productive than the sum of the deal's parts; and (c) bringing GloFo under a US-owned corporate umbrella is vastly beneficial to the national interest in a way that only Intel can fully enable.
  - colinmhayes 5y ago
    I think (c) will be enough for intel to get the government off its back here. GF is currently owned by the UAE government. The military would love for American foundries to be owned by American companies.

taspeotis 5y ago

It feels like AMD was already stepping away: https://www.anandtech.com/show/16677/amd-and-globalfoundries-update-wafer-share-agreement-through-2024 https://www.anandtech.com/show/16677/amd-and-globalfoundries... > AMD will see out its existing commitment to use GlobalFoundries through 2024, with the latest amendment setting purchase targets for 2022, 2023, and 2024. Beyond those new targets, however, the agreement releases AMD from all further exclusivity commitments to GlobalFoundries. AMD is now free to use any fab on any process node that it wants.

totalZero 5y ago
They traded exclusivity for a minimum order size. I'm not sure I would read that negotiation as setting a sunset date on their overall relationship at the end of 2024, and I definitely wouldn't read it as AMD being totally free prior to 2025. 1.6B is half a quarter's revenue for AMD. Milan has been a slam dunk; there's obviously some value over at GloFo for AMD, and it wouldn't be a no-tears breakup (hypothetically speaking). I don't dispute that GloFo's role in AMD's strategy will necessarily change if it becomes part of Intel.

coliveira 5y ago

Another reason why this deal should be blocked by the government. It is anticompetitiveness at its core.

totalZero 5y ago
If I were Intel and a deal were really in the works contingent on antitrust, I would argue that: (a) Intel is a distant third in fabrication and a merger with another also-ran would improve competitiveness against state-backed TSMC and the Samsung chaebol; (b) the severity of the demand creation in the market justifies an acquisition that streamlines existing players and makes them more productive than the sum of the deal's parts; and (c) bringing GloFo under a US-owned corporate umbrella is vastly beneficial to the national interest in a way that only Intel can fully enable.
- colinmhayes 5y ago
  I think (c) will be enough for intel to get the government off its back here. GF is currently owned by the UAE government. The military would love for American foundries to be owned by American companies.