Intel EVP Stacy Smith on Spending Plans, Immigration Ban

TL;DR

Intel announces $7B factory investment in Arizona amid immigration policy discussions.

Transcript

Stacy Smith joining us right now former CFO at Intel and big fancy title now but uh this is something you've been overlooking the capital expenditures of Intel for a long time St and I and I wonder um the big question is this new spending is this incremental on the 11 billion that was expected for 2017 already so uh it's in our Capital forecast for... Read More

Key Insights

• Intel plans to invest $7 billion in a new semiconductor factory in Chandler, Arizona, creating 3,000 direct jobs and 10,000 community jobs.
• The factory, Building 42, already has a shell and will be completed over several years, with a total capital expenditure of $7 billion.
• Intel's capital spending and R&D investments are among the highest globally, with a significant portion focused in the United States.
• Despite high U.S. tax rates, Intel continues to invest domestically due to access to talent, infrastructure, and global markets.
• Intel's new factory will be one of the largest construction projects globally, requiring 3,000 construction workers to complete.
• Intel's leadership emphasizes the importance of hiring global talent and is concerned about the impact of immigration policies on their workforce.
• Intel engages with both Democratic and Republican administrations on issues like tax, investment policy, and immigration.
• The company advocates for more H1B visas to be allocated to high-skilled technical professionals to maintain its competitive edge.

Questions & Answers

Q: What is the significance of Intel's new factory investment?

Intel's $7 billion investment in a new semiconductor factory in Chandler, Arizona, is significant because it represents a major expansion of the company's manufacturing capabilities. The factory will create 3,000 high-tech jobs and 10,000 additional jobs in the community, highlighting Intel's commitment to domestic investment and job creation.

Q: How does Intel plan to address high U.S. tax rates?

Intel is working closely with the administration to advocate for more pro-investment policies that would make it more economically viable to continue investing heavily in the U.S. Despite the U.S. having some of the highest corporate tax rates globally, Intel remains committed to domestic investments due to the availability of skilled labor and infrastructure.

Q: Why is Intel's engagement with political administrations important?

Intel's engagement with both Democratic and Republican administrations is crucial for addressing issues that directly impact the company's operations, such as tax policies, investment incentives, and immigration laws. By maintaining open communication with political leaders, Intel seeks to influence policies that support its business goals and ensure access to global talent.

Q: What challenges does Intel face with current immigration policies?

Intel faces challenges with current immigration policies due to restrictions that may limit the company's ability to hire the best global talent. The company relies on a diverse workforce to tackle complex R&D problems and is concerned that immigration bans and restrictions on H1B visas could hinder its competitiveness and innovation.

Q: How does Intel view the importance of H1B visas?

Intel views H1B visas as essential for hiring high-skilled technical professionals, particularly in fields like math and science. The company is advocating for a greater proportion of H1B visas to be allocated to these areas to ensure it can continue to attract and retain top talent from around the world, which is vital for maintaining its competitive edge.

Q: What is the timeline for completing the new factory?

The timeline for completing Intel's new semiconductor factory in Chandler, Arizona, is approximately three to four years, depending on the starting conditions. Since the factory already has a shell, the construction and outfitting process will focus on making it fully operational, involving around 3,000 construction workers during the build-out phase.

Q: How does Intel's investment in Arizona impact the local community?

Intel's investment in the new factory in Arizona will have a significant impact on the local community by creating 3,000 direct high-tech jobs and an additional 10,000 jobs in supporting roles. The construction project itself will also provide employment for 3,000 construction workers, contributing to the region's economic growth and development.

Q: What role does global talent play in Intel's success?

Global talent plays a crucial role in Intel's success by bringing diverse perspectives and expertise to solve complex R&D challenges. Access to the best talent worldwide enables Intel to remain at the forefront of technological innovation, and the company actively seeks to hire individuals with advanced skills in technical fields to maintain its competitive advantage.

Summary & Key Takeaways

• Intel is investing $7 billion in a new semiconductor factory in Chandler, Arizona, which will create thousands of jobs. The factory, known as Building 42, already has a shell and will be completed over several years, becoming the most advanced semiconductor factory globally.

• Despite facing high tax rates in the U.S., Intel focuses its capital expenditures and R&D investments domestically due to access to skilled talent, infrastructure, and global markets. The company is working with the administration to promote pro-investment policies.

• Intel emphasizes the need for global talent, expressing concern over immigration policies that may impact its workforce. The company seeks to increase the proportion of H1B visas for high-skilled technical professionals and engages with both political parties on various issues.