Micron Technology will invest $150 billion in semiconductor research and development and manufacturing over the next 10 years.

The Boise, Idaho-based chipmaker is a leading supplier of silicon used in everything from dynamic random access memory (DRAM) modules to the NAND flash in SSDs. Notably, the company is also one of the few chipmakers with a large foundry footprint in the U.S.

“Memory is the leading edge of semiconductor manufacturing and fuels everything from feature-rich 5G smartphones to the AI-enabled cloud,” Micro President and CEO Sanjay Mehrotra said in a statement. “Micron’s leadership in both DRAM and NAND technologies and the strength of our roadmap enable us to invest more than $150 billion with confidence to extend our industry leading memory innovation into the next decade.”

While Micron plans to invest heavily in developing next-generation memory technologies, it hasn’t committed to expanding fab capacity.

“We look forward to working with governments around the world, including the U.S. where CHIPS funding and the FABS Act would open the door to new industry investments, as we consider sites to support future expansion,” Mehrotra said.

Micron has pushed for government assistance for months. In February, Micron was one of several U.S. chipmakers that signed onto a letter penned by the Semiconductor Industry Association calling on the Biden administration to provide subsidies and tax incentives to support domestic semiconductor manufacturing.

Micron claims this funding is essential to overcome the high cost of U.S. memory manufacturing, which it says is 35% to 45% more than in “lower-cost markets.”

“Sustained government support is essential for Micron to ensure a resilient supply chain and reinforce technology leadership for the long term,” Micron Global Operations EVP Manish Bhatia said in a statement.

According to Wayne Lam, senior director of research for the Americas at CCS Insight, Micron’s expansion plans may be motivated by its acquisition of Intel’s memory business and a desire to stay competitive against rival Samsung Electronics.

“The Intel technology — cross point — memory is different than DRAM or NAND memory as it has characteristics of both,” he explained. “There’s also increasing demand for memory for both DRAM and NAND.”

In addition to supporting Intel’s memory tech, Micon's investments should help the vendor stay competitive with South Korea’s Samsung Electronics and China’s up and coming memory manufacturers, Lam said.

“By announcing the capital investments now, Micron is signaling many intents to the investor community but the over arching theme here is that the industry is building back capacity as demand rises,” he said, adding that Micron should be cautious as an over-supply of chips could “crater prices.”

In addition to addressing the surge in demand for memory, Dell'Oro analyst Baron Fung argues Micron's expansion should benefit U.S. cloud providers as well.

“The top four U.S. Cloud providers will be heavy users for memory in the foreseeable future, and may want to have a stronger partner in the U.S.,” he said.

However, like Lam, Fung cautioned it may not be in Micron's best interest to be the largest memory supplier if it means lower margins.

The plan comes as foundry operators announce hundreds of billions of dollars in new spending to expand capacity and combat the global semiconductor shortage.

Earlier this year, TSMC, the world’s largest foundry operator, announced plans to invest $100 billion over the next three years to meet the growing demand for chips.

Similarly, Samsung said it would spend $205 billion over the next three years to bolster its semiconductor and biotech businesses. Roughly two-thirds of that funding will go toward expanding the use of extreme ultra-violet lithography-based, sub-14-nanometer DRAM and high-density — 200-plus-layer — 3D NAND flash products. The latter will compete directly with Micron’s product portfolio.

Meanwhile, Intel has moved aggressively to expand its foundry operations, breaking ground on a $20 billion foundry expansion in Arizona. The company is expected to announce additional foundry expansions in the U.S. and Europe before the end of the year.