In a surprising turn of events, SkyWater Technology Inc. has decided not to move forward with its plans for a $1.8 billion semiconductor production and R&D facility in Indiana. Although the company has secured an option on the land, it remains committed to its partnership with Purdue University and ongoing research opportunities. The initial announcement of the project was made in July 2022 as a joint venture between SkyWater, the state of Indiana, and Purdue University, with plans to seek federal funding from the CHIPS (Creating Helpful Incentives to Produce Semiconductors) and Science Act.
Representatives from SkyWater have yet to provide any official comment on their decision to withdraw from the Indiana project. However, in their annual report filed with the Securities and Exchange Commission, the company acknowledged potential risks associated with the project, expressing concerns about meeting obligations and achieving anticipated benefits within the expected timeframe. The CHIPS program, which aims to support domestic manufacturing and supply chains, has recently been highlighted by President Joe Biden’s announcement of a preliminary agreement with Taiwan Semiconductor Manufacturing Company.
On a positive note, SkyWater reported an increase in revenue for 2023 totaling $286.7 million. Despite this growth, however, the company recorded a $25.1 million net loss for the year. In addition to its Bloomington facility upgrades through its CHIPS application submitted in the fourth quarter of 2022 for modernization and upgrades at its manufacturing facility in Bloomington, Polar Semiconductor is also awaiting news on its own CHIPS application after expressing intentions to invest over $420 million in upgrades for its facility located next door to SkyWater’s planned facility.
Overall, while it is unclear what factors led SkyWater to pull back from its Indiana project at this time
