Trump administration prioritizes American chipmaking

Micron Technology announced plans to invest $200B in domestic semiconductor manufacturing and R&D to strengthen American memory chip production. The tech company’s DRAM technology powers nearly everything, including AI, high-performance computing, the automotive industry, and next-generation wireless devices.

Chipmaker Micron Technology was the latest company to pledge large-scale investments in the country since President Trump won the election. According to the tech company’s Thursday statement, the spending will include roughly $150B for expanding domestic manufacturing capacity and another $50B for R&D. The total represented an increase of $30B beyond what it had previously budgeted.

Micron restores domestic chipmaking strength

Micron Technology joined a growing list of U.S. tech firms and chipmakers investing hundreds of billions to bring more chip manufacturing jobs back to the U.S. The announcement is part of the Trump Administration’s push to restore domestic chip manufacturing strength, advance America’s role as a technology leader, and put American workers first. Micron is expected to get about $6 billion in Chips Act money to build domestic production capacity. The new investments will create over 90K direct and indirect jobs.

The tech firm will build on its existing investments in Idaho, New York, and Virginia. The U.S.-based chipmaker will construct a second state-of-the-art (SOTA) chip fabrication facility in Boise, Idaho. Micron will also expand and modernize its factory in Manassas, Virginia, to onshore technology from Taiwan. Micron has finalized a $275 million CHIPS Act direct funding award supporting its investment to expand and modernize its Virginia facility, which will begin this year. The investment will onshore its 1-alpha DRAM node. These investments will support the firm’s goal of producing 40% of its DRAM in the U.S. 

The company had previously pledged to invest about $125 billion to build factories in the US, though it began slow-walking some plans last year. The Micron team disclosed that the additional $30 billion from the pledged funds will be used for various projects, including the advanced packaging necessary to produce high-bandwidth memory (HBM) chips. 

“Micron’s investments will likely span over several decades given the company’s focus on cash generation and potential investor concerns over excess capital spending.”

– Jake Silverman, Analyst at Bloomberg Intelligence 

However, while the company’s timeframe for the overall $200 billion investment plan was unclear, it allocated between $7 billion and $12.5 billion to annual capital spending in recent years. According to InvestingPro data, Micron maintains a strong financial foundation for this expansion with a healthy current ratio of 3.13 and an overall Financial Health score of “GOOD.”

Trump administration prioritizes American chipmaking

The Trump administration has prioritized getting Apple Inc., Microsoft Corp., and Taiwan Semiconductor Manufacturing Co. to make public investment pledges in the U.S. to stimulate the economy and boost its manufacturing base.

Commerce Secretary Howard Lutnick said in a hearing last week that the U.S. was reworking agreements it had reached with semiconductor companies under the 2022 Chips Act to secure what he described as better terms. Lutnick said the Trump administration was renegotiating terms to benefit the taxpayer and get more value for the same amount of dollars. 

Notably, the Commerce Secretary cited the decision by TSMC to add $100 billion to its previous commitment of $65 billion in investment. The Taiwanese chipmaker will receive $6.6 billion in Chips Act grants, but it stepped up its plans without additional government money. 

The Trump administration also took credit for ongoing projects like the possible $500 billion AI venture by Japan’s SoftBank Group Corp. and OpenAI that will take many years to complete. The project’s progress slowed earlier this year.

Apple plans to invest more than $500 billion in the U.S. over the next four years. The investments will include a large factory in Texas for AI servers and an addition of about 20K research and development jobs across the country.

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