(Reuters) -Intel will invest more than $28 billion to build two new chip factories in Ohio, the company said on Friday, in a latest move to build out its contract manufacturing business and better compete with Taiwan Semiconductor Manufacturing Co.
Shares of the struggling chip company rose nearly 2% in early trading. The stock is down more than 55% this year.
Intel’s foundry business is central to CEO Pat Gelsinger’s turnaround strategy, as the onetime chipmaking king tries to regain the technological edge it lost to TSMC, the world’s largest contract chipmaker.
The major investment comes more than a month after Intel signed a multibillion-dollar deal with Amazon to build custom AI chips for the e-commerce giant’s cloud services unit. The deal was seen as a major sign of approval for Intel’s money-losing foundry business.
The Santa Clara, California-based company said Friday that the first phase of the project is expected to create 3,000 Intel jobs.
The chipmaker has had a tumultuous year, which saw its dividend suspended, its workforce slashed and a high-profile board member suddenly resigning, while a share price slump threatened its place in the Dow Jones index.
(Reporting by Deborah Sophia in Bengaluru; Editing by Shilpi Majumdar)
