RFMD Adopts Flexible Gallium Arsenide Sourcing Strategy

Latest innovations being made in the semiconductor arena are compelling enterprises to phase out previously developed solutions so that the markets and end-users can benefit from better, enhanced and lower cost solutions.

RF Micro Devices (News - Alert), Inc., a provider of advanced radio frequency solutions that allow mobility, enhanced connectivity and support advanced functionality in various devices, has adopted a new Gallium Arsenide or ‘GaAs’ sourcing strategy that will make the manufacturing process more flexible, increase gross margin and boosting growth rates as well. The company is well known for offering a wide range of semiconductor technology solutions that support advanced functionality in mobile devices, wireless infrastructures, wireless local area networks (WLAN), smart energy/advanced metering infrastructures (AMI), and aerospace and defense markets.

After the new development, RFMD (News - Alert) will gradually shift most of its GaAs manufacturing to its GaAs HBT manufacturing facility in Greensboro, N.C. and will also go on to reduce the manufacturing activities in its Newton Aycliffe, its UK-based GaAs pHEMT facility. Apart from that, it will increase its overall capacity by working closely with various well known GaAs HBT foundries.

The company had been leveraging its Newton Aycliffe GaAs pHEMT facility for the development of cellular switches, but recently has begun manufacturing silicon on insulator or ‘SOI’ solutions that are relatively cheaper and offer better performance. Within the next nine to 12-month period, the shift will take place so that already booked millimeter wave customer contracts can be finished successfully. RFMD hopes that after the implantation takes place, it will be able to save around $5 million per quarter or around $20 million per year.

“RFMD is enjoying increasing demand for our GaAs- and silicon-based RF solutions by delivering the industry’s highest performance and most innovative products and technologies, including power amplifiers, switches, antenna tuners, and envelope tracking solutions,” commented Bob Bruggeworth, president and chief executive officer at RFMD. “The combination of our industry-leading internal GaAs manufacturing capabilities and our external GaAs and silicon foundry partnerships support our longstanding commitment to Optimum (News - Alert) Technology Matching, satisfy the full breadth of our customers’ performance, size, and cost requirements, and give RFMD unlimited growth potential. We expect these structural changes to have a lasting positive effect on the company’s cost structure, resulting in meaningful gross margin expansion.”