SkyWater Ditches $1.8 Billion Semiconductor Plant in Indiana, but Remains Committed to Purdue University Research

SkyWater Technology Inc. has decided to step back from its plans to build a $1.8 billion semiconductor production and R&D facility in Indiana, despite having already acquired an option on the land. According to Tim Doty, a spokesperson for Purdue University where the project was intended to be located, SkyWater remains a valuable partner with ongoing research opportunities.

The project was announced in July 2022 by Bloomington, Minn.-based SkyWater in collaboration with the state of Indiana and Purdue University. The company had sought funding from the federal CHIPS (Creating Helpful Incentives to Produce Semiconductors) and Science Act as part of the plan. However, concerns about meeting obligations or realizing expected benefits from public-private partnerships were identified by SkyWater representatives in their annual report to the Securities and Exchange Commission in March. These concerns could have had a significant adverse impact on the business, financial condition, and results of operations for the company.

SkyWater had also submitted an application for modernization and upgrades at its existing manufacturing facility in Bloomington as part of discussions related to the CHIPS program. Another company planning investments in upgrades for its Bloomington facility, Polar Semiconductor, is also waiting for news about its application for funding through the federal government. Despite this setback, SkyWater experienced growth with reported revenue of $286.7 million for 2023, marking an increase of 34.6% from the previous year. However, the company recorded a $25.1 million net loss for the year.

While there has been no immediate response from SkyWater representatives regarding their decision to step back from their original plans, it is clear that they are still committed to working with Purdue University and other partners to continue their research efforts in semiconductor technology.