Micron CEO on $6.1B CHIPS Act grant: Excited to bring leading-edge chip manufacturing to the U.S.

6.1 billion in chips funding paired with 125 billion from Micron to build these facilities here in New York and near Micron headquarters in Idaho. And I, you know by the way it’s been mentioned before, it’s the single biggest private investment ever in the history of these two states. The White House announcing preliminary agreement with Micron, we’re going to come up to $6.1 billion in chipsack funding for the building of new plants, second largest ship subsidy in the nation. And we are so just thrilled here at Post nine that my fund CEO, Sanjay Morozer. And Sanjay, first of all, congratulations, this is a remarkable piece of business because you never left the United States to begin. Jim, great to be here on the show with you all in person. Yesterday was definitely a historic day. 18 months ago we were in Syracuse announcing our vision for manufacturing semiconductor memory here in the US and yesterday the President was back there with us and we that vision is coming to reality with this 6.1 billion of grants. We will be building fabs in Boise, ID as well as Syracuse, NY with $50 billion of investment through 2030 time frame. So this is an exciting time bringing leading edge memory semiconductor manufacturing to the United States. Are you talking about doing high bandwidth memory? You know which when we go back and forth, this is the most cutting edge data center chip, Are you doing high bandwidth memory in Syracuse and idle? Once those fabs get built, they will be absolutely in production with leading edge memory. High bandwidth memory absolutely uses leading edge memory. So yes, the wafers for high bandwidth memory for the future nodes will certainly be produced there. Fantastic. Now before I turn over my colleagues, I looked up Clay which is a suburb of Syracuse. Sanjay, you need 10s of thousands of people. Where are you going to get them in an area that frankly has not historically had that many workers. That’s a big focus of us. You know Syracuse area definitely had manufacturing in the past. So it has the roots of manufacturing in the region. The region has the New York State has a strong university ecosystem as well, you know, junior colleges, SUNY and prestigious institutions as well. And of course Micron is heavily engaged with the community there. In fact, with Governor Hocher, we established a community investment framework with $250 million investment from Micron to reach out to rural communities to reach out to veterans, underrepresented groups, women and bring them into the workforce start apprenticeship programs. Micron has started a clean room in Onondaga Community College to train students there. And so we are building the workforce not only in the Northeast here, but across the country. We have major initiatives, no question that you know, bringing the talent is a major priority and of course engaging with construction unions as well to bring the construction workforce that’s needed for the fabs. When you talk about over the next 20 plus years spending a potential of $125 billion Sunday, what are going to be the markers by which you actually judge whether in fact additional capital is warranted? And when will you start to sort of assess whether it’s worth investing beyond the obviously large initial investment? Yes, absolutely. Our investments will be in line with the market demand and of course in the preliminary memorandum of terms that we have signed with the chips program office, We have built in the flexibility so that we can equip our fabs, bring up production in line with the market demand that is extremely important for us to be staying disciplined with CapEx, focusing on cost and bringing supply in line with demand. So of course looking at the demand will always be a key measure. I want to point out that our first fab that will be brought up with the support of the CHIPS grants in Boise ID is Co located with our R&D fab and that really is a great benefit to have R&D and manufacturing Co located. That accelerates time to market of innovative technologies that will go into products like High Bandwidth Memory and then we take them to mega scale in New York. So this $125 billion investment in New York and Idaho will be over the course of 20 years. We are right now focused on the first fab in Boise, ID and the 1st 2 fabs in New York with investment of about $50 billion going through 2030 time frame, right, 50, yeah. Is the workforce issue going to be more acute in Idaho or New York would you say? Would you say, well, we are. Micron was founded in Idaho 45 years ago and you know we are quite a powerhouse there and you can see that in Boise ID. Micron established the workforce. Micron has built a leading edge semiconductor memory company in Boise, ID. We can do that in Syracuse as well early and when when the grants were being framed, there was some criticism that the commerce was attaching too many conditions to really what was about internal HR policies and things like that. Was that ever a sticking point? Well, things like HR policies, these have been DNA of Micron all along. We have focused on really inclusive workforce, absolutely providing child care to our team members. We are very soon we’ll be starting a childcare center. Some of these things were already in play even before we filed for our chips application. And of course some of these details regarding some of the terms. We continue to work on these with the chips program office. They will ultimately be in their final form with the final agreement expected to be later this summer. OK. So Sanjay, the last 36 hours we’ve seen incredible amount of money going to be spent by Mark Zuckerberg. OK. It met up. We see it at Google and we see it at Microsoft. Now I know it’s initially it’s it’s NVIDIA, but it’s going to be you too did. Were you surprised at the gigantic amount of money that is going toward you from these hyperscalers? No question that as we discussed in our earnings call in March that it is AI that is accelerating the demand for memory and memory is a key enabler. I mean, think about it, AI needs data. I mean you look at large language models, then they’re going into trillions of parameters. They need more and more memory, they need that high bandwidth memory, they need low power memory, they need more capacity of memory. If you just look at NVIDIA GPU’s, you know, starting from A-100 with 40 GB of memory, the latest Blackwell announced with 192 gigabyte of memory in just a matter of short period of time. So memory is a key enabler and I just wanted to show you because you brought up High Bandwidth memory, Jim, this is a technical marvel here. How much? This is 24 gigabyte today it is with eight dye stacked into it. This is smaller than my thumbnail, thinner than my thumbnail and we have stacked 8 dye into this today has already sampled this tag with 12 dye in it. Next year it will further give an increase and these AI accelerators are hungry for memory and you know these die. What they do is they need today three times more silicon to produce the same number of bits and you know they give tremendous high bandwidth. So what it’s doing is it’s creating a real shortage on the leading edge supply. Not only high bandwidth memories in great demand is creating a shortage on the non high bandwidth memory. So this is the kind of marvel the Micron team produces. OK, now one this question, I know they’re like hell or me hurry me here, but OK, so Microsoft says PCs now stabilized going hard. How do you feel about PCs right now? They’ll be mentioned in our earnings call in March that PCs will have a modest growth, low single digits, 24 / 23 in terms of unit sales of PCs. What’s important is AI enabled PCs require more memory. They require 40 to 80% more DRAM content than a average PC. And these AI enabled PCs with neural processor units will continue to increase their adoption late this year and into 2025.