Intel is signaling renewed activity at Fab 38, its major semiconductor manufacturing project in Kiryat Gat (Israel). Hoffman Construction now estimates that the project’s completion will occur in 2026, while Intel is recruiting for planning and permitting roles for the plant. These are signs of a possible rebound after work slowed down, although there is currently no official announcement from Intel confirming the immediate launch of a second cleanroom.
The key points of Intel’s Fab 38 in 30 seconds
- Hoffman Construction expects to complete its work on Fab 38 by 2026.
- The complex is designed to surpass 55,000 square meters of cleanroom space and will host equipment for processes based on EUV lithography.
- Intel has been hiring staff for planning and permits for its Kiryat Gat facility.
- The company continues the development of Intel 14A, but has linked further significant investments to securing external customers.
- Intel recently announced a capital raise of $15 billion, intended for corporate purposes, including potential capital investments.
These signals come at a particularly sensitive moment for Intel’s industrial strategy. The company is trying to regain competitiveness in advanced manufacturing against TSMC and Samsung, while managing investments that have required tens of billions of dollars over recent years.
Fab 38 could become a significant element of this plan. Originally, Intel presented the Kiryat Gat project as a roughly $25 billion investment to expand its advanced manufacturing capacity in Israel. The plant is located next to Fab 28, one of the company’s main manufacturing centers outside the United States.
However, the situation has changed several times since the expansion was announced.
Fab 38 moves forward again after slowdown
Hoffman Construction, the contractor involved in the project, currently maintains a public record identifying Kiryat Gat as the location of Fab 38, with 2026 as the completion year.
The builder states that the complex will include over 600,000 square feet of cleanroom space, roughly 55,700 square meters, in addition to two main service buildings and other infrastructure needed for a semiconductor factory.
It also indicates that the facilities will host equipment capable of manufacturing chips through processes based on extreme ultraviolet (EUV) lithography, the technology currently used for some of the most advanced semiconductors.
Previously, Intel explained that Fab 38 would be located next to Fab 28. During construction, corporate documentation described the project as a new $25 billion factory dedicated precisely to advanced manufacturing.
Progress has not always been at the expected pace. In 2025, reports emerged about pauses or slowdowns in certain work in Kiryat Gat. At that time, Intel was reassessing its international investments and trying to align capital spending with actual demand for its products and Intel Foundry services.
The latest development now points again toward activity at the site.
Besides Hoffman’s update, Intel has posted a job opening related to overall planning and permit management for Kiryat Gat. While a single job listing doesn’t confirm that the company has approved building or equipping a second cleanroom, it does suggest increased industrial planning activity at the site.
Therefore, it’s important to distinguish between confirmed facts and interpretations. Hoffman confirms that its Fab 38 project is set to finish in 2026 and that the facility is ready to host EUV processes. Meanwhile, Intel has not officially announced that it will immediately deploy all the capacity originally planned.
Intel 14A influences the company’s future investments
This movement is particularly interesting given Intel’s investment policy under Lip-Bu Tan’s leadership.
The company has made clear it does not want to build advanced capacity solely on the expectation of external customers appearing later. Intel needs to first demonstrate that demand is sufficient to justify investments that could reach billions of dollars.
This discipline especially affects Intel 14A, the process node succeeding Intel 18A, which will be crucial in determining whether Intel Foundry can attract major external chip designers.
Intel has acknowledged in filings with the U.S. Securities and Exchange Commission (SEC) that securing a significant external customer for Intel 14A is an important condition for continuing investments in its most advanced manufacturing technologies.
The company’s warning is clear: if it fails to secure a major external customer for 14A, it might slow down or even halt development of this technology and later nodes.
This warrants caution when interpreting Fab 38 developments.
Accelerating investments in Kiryat Gat could be a positive sign of Intel’s internal expectations, but it does not by itself prove that the company has already secured a major external contract for Intel 14A.
Intel has previously communicated that several key customers are evaluating the technology. It has shared early versions of the Intel 14A Process Design Kit (PDK), and some clients have expressed interest in fabricating test chips.
However, there is a significant difference between a test and a large-scale manufacturing contract.
A $15 billion capital raise amidst industrial growth
The Fab 38 activity coincides with another major move. On August 10, Intel announced a $15 billion public stock offering, one of the company’s largest recent capital raises.
Intel explained that the proceeds will go toward general corporate purposes, which may include capital investments and working capital.
The company also linked this move to growth opportunities driven by demand for AI computing, specialized chips, advanced packaging, and external manufacturing services.
Underwriters will also have an option to buy additional shares worth up to $2.25 billion. Later reports indicate that, due to investor demand, Intel might consider raising the offering to about $20 billion, but this is unconfirmed until the company finalizes the details.
It is premature to directly associate all this funding with Fab 38. Intel has not stated that the proceeds will be specifically allocated to Israel.
What is clear is that Intel is seeking additional capital precisely when it needs to fund new manufacturing and packaging capacity, while maintaining a strong balance sheet and investment grade credit rating.
Fab 38 is part of a much larger industrial network. Intel operates manufacturing facilities and projects across the U.S., Ireland, and Israel, among other locations. Recently, the company has had to review the timelines of some expansions to avoid building costly factories with insufficient utilization.
The case of Ohio illustrates this clearly. Intel has acknowledged it has slowed down the construction of new advanced manufacturing facilities there as it assesses future demand.
Israel remains a strategic industrial location for Intel
Maintaining investments in Kiryat Gat also has an obvious geopolitical dimension. Israel has experienced heightened regional tensions for years, adding risks to any large-scale industrial project.
However, Intel’s relationship with Israel spans decades. Its operations include manufacturing and R&D centers focused on processors, communications, and artificial intelligence.
Kiryat Gat is particularly significant within this presence because it hosts advanced manufacturing capacity.
The main issue now is not just finishing the buildings. A semiconductor factory truly becomes operational when the cleanrooms receive the necessary manufacturing equipment, lithography, deposition, etching, and metrology systems are installed, processes are validated, and production begins gradually.
Such equipment can account for a large part of the total investment.
Therefore, the 2026 date from Hoffman should primarily be seen as the completion of their part of the construction project, not necessarily the date when Fab 38 will start full chip production.
What recent movements suggest is that Kiryat Gat remains within Intel’s industrial plans. For a company revisiting carefully where each new dollar is invested, completing infrastructure and maintaining active planning for an advanced factory is a meaningful indicator.
The key question will be how much equipment Intel finally installs, when it does so, and which nodes of manufacturing it intends to support. These decisions depend both on the evolution of its own products and on Intel Foundry’s more challenging goal: convincing major chip designers to move their upcoming processors to Intel fabs.
Frequently Asked Questions
What is Intel Fab 38?
Fab 38 is a new semiconductor manufacturing facility located in Kiryat Gat, Israel, adjacent to Fab 28. Intel announced the project as a roughly $25 billion expansion aimed at advanced manufacturing capabilities.
When will Fab 38 be finished?
Hoffman Construction currently cites 2026 as the completion year. That doesn’t necessarily mean the entire factory will be fully equipped or producing chips at full capacity by then.
Will Intel produce Intel 14A chips in Fab 38?
Intel has not publicly confirmed that Fab 38 will produce Intel 14A. The facility is designed to support equipment compatible with EUV-based processes.
Has Intel secured external customers for Intel 14A?
Intel has mentioned some companies evaluating Intel 14A and interested in test chip production, but this does not constitute a public confirmation of large-scale production contracts. The company has conditioned further significant investments on securing sufficient external demand.
Sources:
- Intel, corporate information regarding its major manufacturing projects and Fab 38 in Kiryat Gat.
