When Micron unveiled plans to build two new fabs in the U.S. in 2022, the company initially stated that both facilities would be operational by the end of the decade. In 2023, the company began optimizing its expenditures, accelerating production at these facilities. This week, Micron provided more specific timelines for its fabs in Idaho and New York, indicating they will start operations between 2026 and 2029.
“These fab construction investments are necessary to support supply growth for the latter half of this decade,” according to a statement from Micron in its Q3 FY2024 financial results report reads. “This Idaho fab will not contribute to meaningful bit supply until fiscal 2027 and the New York construction capex is not expected to contribute to bit supply growth until fiscal 2028 or later. The timing of future [wafer fab equipment] spend in these fabs will be managed to align supply growth with expected demand growth.“
Micron’s fiscal year 2027 starts in September 2026, so the new fab near Boise, Idaho, is projected to begin operations between September 2026 and September 2027. The company’s fiscal 2028 starts in September 2027, making it likely that the New York fab will start operations in calendar 2028 or later, depending on the demand for DRAM memory in coming years. Thus, Micron’s U.S. memory fabs are anticipated to start operations between late 2026 and 2029, aligning with the company’s initial timeline.
Construction of the fab in Idaho is progressing well, whereas construction of the New York facility has not yet commenced due to ongoing regulatory and permitting processes in the state.
Micron’s capital expenditure (CapEx) plan for FY2024 is approximately $8.0 billion, with a year-over-year decrease in spending on wafer fabrication equipment (WFE). In Q4 FY2024, the company plans to invest around $3 billion in fab construction, new wafer fab tools, and various expansions/upgrades.
Looking ahead to FY2025, Micron plans a significant increase in CapEx, targeting a mid-30s percentage of revenue to support various technological and facility advancements. Specifically, the company expects its quarterly CapEx to average above the $3 billion level seen in Q4 FY2024, translating to about $12 billion in fiscal 2025, which begins in late September.
Half or more of the total CapEx increase in FY2025 (i.e., over $2 billion) will be directed towards constructing new fabs in Idaho and New York. Additionally, FY2025 CapEx will rise significantly to support high-bandwidth memory (HBM) assembly and testing, as well as the construction of fabrication and back-end facilities. Investments will also be made in technology transitions to meet growing demand.
“Fab construction in Idaho is underway, and we are working diligently to complete the regulatory and permitting processes in New York,” said Sanjay Mehrotra, chief executive officer of Micron, during the company’s conference call with investors and financial analysts (via SeekingAlpha). “This additional leading-edge greenfield capacity, along with continued technology transition investments in our Asia facilities, is required to meet long-term demand in the second half of this decade and beyond. These investments support our objective to maintain our current bit share over time and to grow our memory bit supply in line with long-term industry bit demand.“
