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28 September 2007


RFMD expands to accommodate cellular and multi-market demand

RF Micro Devices Inc of Greensboro, NC, USA, the world's largest manufacturer of GaAs HBTs and pHEMTs, has announced plans to expand its compound semiconductor manufacturing capacity with a new fab in North Carolina to support growth expectations in its Cellular and Multi-Market product groups.

In the cellular handset market, the increasing adoption of highly integrated, multi-chip transmit modules and the migration to 3G multimode devices are expected to drive increased demand for RFMD’s GaAs pHEMTs and HBTs (both AlGaAs and InGaP). These market trends require greater quantities of compound semiconductor content and are expected to underpin a five-year compound annual growth rate of greater than 20% from 2007-2012 in the market for cellular front-ends, reckons the firm. RFMD was recently recognized as the leading manufacturer of cellular front-ends.

Also, in markets served by RFMD’s Multi-Market products group, it is anticipated that the migration to the IEEE 802.11n wireless local-area network (WLAN) standard (GaAs HBT and pHEMT) and the increasing adoption of WiMAX (GaAs HBT and GaN) will be among the main drivers of increased compound semiconductor content and accelerated market growth. RFMD claims that its GaN process technology is quickly being recognized for applications that require high power, linearity and bandwidth compared to existing technologies such as silicon LDMOS. The firm is currently ramping commercial production of its GaN process technology.

“RFMD has consistently been the world’s largest supplier of GaAs devices for several years… The company continues to move in line with the requirements of the cellular handset market, and this will continue to drive the volume at RFMD,” says Asif Anwar, director of Strategy Analytics GaAs and Compound Semiconductor Technologies (GaAs) service. “RFMD has also developed a coherent multiple-market strategy to target higher-value segments with the rollout of its GaN and GaAs pHEMT technologies as well as the expansion of its IP and product portfolios through the proposed Sirenza acquisition [announced in mid-August],” he adds. “This dual ‘high volume-high value’ strategy will help the company remain at the forefront of the compound semiconductor industry,” Anwar concludes.

“The markets served by RFMD are growing, and RFMD is growing its compound semiconductor content within these markets,” says the firm’s president and CEO Bob Bruggeworth. “The addition of our third fab will enable us to capture a greater percentage of this growth while also reducing manufacturing costs and driving continued improvement in operating profitability,” he adds. “Once complete, our third fab, in conjunction with our second fab, will focus on high-volume cellular and WLAN front-end products that utilize GaAs HBT and GaAs pHEMT.” The new fab will also provide capacity for the production of wafer-level packaged surface acoustic wave (SAW) filters and the development of new, next-generation process technologies that provide highly integrated front-end functionality. Meanwhile, the first fab will focus on high-value multi-market products that use specialty GaN, GaAs pHEMT and GaAs HBT technologies.

Meanwhile, in order to satisfy immediate forecasted demand, RFMD is currently increasing its manufacturing levels for both GaAs HBTs and pHEMTs.

*According to The Triad Business Journal, North Carolina state Governor Mike Easley says that RFMD plans to invest $118m and add 350 jobs over the next four years: $103m in expanding its existing campus in Greensboro (creating 300 new jobs and raising total staffing in Guilford County to more than 2200) and $15m in building a smaller facility in Mooresville, Iredell County that will employ 50. “This is RF Micro Devices’ fourth major facility in Guilford County in the 16 years since it opened,” Easley said.

After offers of incentives from cities across the south-east USA, RFMD had considered several sites, including expanding its plant in China, but decided to expand in North Carolina. “We are extremely appreciative of the support we received from the Governor, our state representatives, and city officials, who were instrumental in our decision to expand our manufacturing operations here,” said Jerry Neal, RFMD’s co-founder and VP of marketing and strategic development.

The expansion is being facilitated by North Carolina state’s Economic Investment Committee awarding a Job Development Investment Grant lasting 11 years. For each year RFMD meets required performance targets, the state will provide a grant equivalent to 70% of the state personal income withholding taxes derived from the creation of the new jobs. If RFMD sustains all of the jobs for 11 years, it could receive up to $4.25m.

See related items:

RFMD diversifies by acquiring Sirenza

RFMD, Skyworks and Triquint grew GaAs device market share to 55% in 2006

RFMD’s revenues fall 11%, but forecasts 9-16% bounceback this quarter

RFMD expands Beijing assembly facility’s capabilities

RFMD moves up the rankings

Filtronic to cut 115 jobs as RFMD decides to cease buying GaAs pHEMT switches in September

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