Intel recently reported a strong second quarter, generating more than $16 billion in revenue, a 25% year-over-year increase.
Meanwhile, work continues — slower, but seemingly steady — at Intel’s Ohio One site in New Albany.
Intel reports that it’s still on track to complete the first of two semiconductor fabricating plants by 2031, but the company won’t share details on how much of the construction at the campus is complete.
Heavy trucks hauling all sorts of materials rumble down the rural roads surrounding the site.
From beyond the fence, it’s hard to glean the exact status of the buildings under construction at the sprawling, nearly 1,000-acre complex, but certainly more work has been done since this time last year.
"I think the whole region is eagerly anticipating a day when we can gather and have a ribbon cutting of this facility," said New Albany Mayor Sloan Spalding.
Spalding said there have been "some slowdowns" in construction, but that "things are picking up."
"Intel's been pretty transparent about their need to get customers lined up in order to keep the project moving along at a good pace," Spalding said.
In a statement this month, Intel said the $28 billion Ohio One campus is still a “critical part” of the company’s long-term manufacturing strategy — but its project deadlines continue to be flexible based on customer demand.
Ohio One's big promise
Intel announced the New Albany "mega-fab" project in January 2022. It was originally set to open within three years, and it was billed as both the nation’s first Intel chip factory and the company’s first new manufacturing site in four decades.
"Under the prior CEO, Pat Gelsinger, there was a lot less discipline about building out capacity to support its customers without customer commitments," said John Vinh, a research analyst KeyBanc Capital Markets who specializes in the semiconductor industry.
Vinh said Intel has long been focused on semiconductor manufacturing, but the company’s strategy around it only recently became more “financially disciplined.”
Gelsinger abruptly left Intel at the end of 2024 after a downturn triggered massive layoffs. A few months later, Lip-Bu Tan became CEO. He further slowed construction of New Albany’s fabs, saying the company had invested too much too soon.
As of the end of last year, Intel had sunk more than $5 billion into the site. The company says that including contract commitments, the total investment is closer to $7 billion.
Semiconductor demand not slowing
While the company may be moving a little slower, Vinh said the demand for semiconductors has only grown since Intel announced the New Albany project.
"There’s kind of two things that’s driving that. One is the demand for AI semiconductor chips," Vinh said. "The second thing is the increasing need for geopolitical diversification."
Right now, Taiwan Semiconductor Manufacturing Company produces the vast majority of the world’s high-end chips. TSMC can’t keep up with demand, Vinh said.
Plus, the U.S. and China are vying to achieve AI dominance, and political tensions between China and Taiwan are building.
"I think there is a need and a desire to be able to manufacture chips outside of Taiwan," Vinh said.
"You better make sure you know what your ordering, because it's like a two-year lead time and (it's) very expensive to put the equipment there to make their chips."- Licking County Commissioner Tim Bubb
Who will make semiconductor chips in New Albany?
Licking County Commissioner Tim Bubb believes semiconductor chips will be made in New Albany. He called the project there "too big to fail."
"The question gets to be, will Intel be the ultimate operator of the site? Will it be Nvidia? Will it a combination of businesses?" Bubb asked. "Who will actually be the manufacturer on that Intel site to do manufacturing?"
Rumors have been swirling that Intel is seeking a partner to help produce chips in New Albany. Last year, Nvidia, a leading chipmaker, committed to a $5 billion partnership with Intel to work on custom data centers. The New Albany site isn’t directly connected to that agreement.
Other reports suggest Intel is inking a deal with South Korean semiconductor company SK Hynix to rent at least a portion of the New Albany chip manufacturing facility.
"The question has not been answered yet, but in all fairness to Intel, they're living up to their commitments to create jobs on the site, to build the buildings and get the site ready for work," Bubb said.
Bubb has been told that the equipment to make semiconductor chips is highly specialized and must be custom-made. As far as he knows, Intel hasn’t ordered the machines yet.
"You better make sure you know what you're ordering, because it's like a two-year lead time and (it's) very expensive to put the equipment there to make their chips," he said.
Coming to grips with the project
Spalding understands that there are no guarantees in life — or in semiconductor chip manufacturing.
Due to the slow-down in construction, some suppliers that intended to work with Intel are also waiting to get up and running, Spalding said. The new pace has also provided some breathing room for the community.
"I think, you know, that pause has helped us come to grips with the scope of the project," Spalding said.
For now, New Albany is taking things one day at a time.
