RFMD expands wafer fabrication 40%

By Control Engineering Staff May 4, 2006

Greensboro, NCRFMD a provider of proprietary, radio-frequency integrated circuits (RFICs) for wireless communications applications, announced an $80-million wafer fabrication facility (Fab) expansion. Expansion of the Greensboro campus, is expected to increase RFMD’s wafer-manufacturing capacity by approximately 40% from current levels—utilizing GaAs HBT and GaAs pHEMT process technologies. The expansion is also expected to reduce the company’s cost per wafer and provide available capacity to increase internal production of GaAs pHEMT—a critical enabling technology in the company’s transmit modules.

Growing demand for GaAs technology is being fueled by multiple factors, including market share gains and robust demand for mobile devices. According to industry forecasts, over 900 million cellular handsets will ship in 2006, driven by emerging markets and new feature-rich devices. Within these handsets, a growing number will feature RFMD’s power amplifier (PA) and transmit modules, which integrate GaAs pHEMT transmit switch-technology with the company’s GaAs HBT power-amplifier technology. Additionally, 3G (or multi-mode) handsets contain multiple transmit chains, requiring multiple PAs. Industry analysts currently forecast 3G handset sales will double—in both 2006 and 2007—to about 200 million units. Finally, in the growing market for WLAN in handsets, there is increased demand for WLAN front-end modules, which feature both GaAs HBT and GaAs pHEMT technologies.

This is the fifth capacity expansion the company has announced in its 15-year history. Company revenue was $150.4 million in first-quarter 2005, when the previous Fab expansion was completed, and increased to $208.0 million in fourth-quarter 2005, less than one year later.

RFMD has begun expanding its wafer -fabrication equipment base in existing clean room facilities, with volume production expected in late 2006. RFMD expects to add 300 new skilled positions at the expanded facility.

And the company was the recipient of a Job Development Incentive Grant from the State of North Carolina that provides up to $4.9 million in tax credits toward the expansion. RFMD also received a collective pledge of nearly $1.5 million from the City of Greensboro and Guilford County.

— Richard Phelps, senior editor, Control Engineering