Applied Materials is investing $5 billion to build a chip R&D center, with the goal of cutting AI chip development cycles in half.

Applied Materials, the world’s largest semiconductor equipment manufacturer, has officially inaugurated the EPIC Semiconductor R&D Center. Located in Sunnyvale, California, the project is expected to have a total investment of $5 billion, aimed at accelerating innovation in advanced chip technology for the AI era. Spanning approximately 600,000 square feet, the EPIC Center will host research teams from industry giants including Intel, TSMC, Micron, SK Hynix, and Samsung, who will collaborate with Applied Materials engineers on R&D and gain early access to the latest semiconductor manufacturing equipment. Applied Materials noted that the center is expected to cut the cycle for next-generation chip architectures from concept development to commercialization, from the usual 10 to 12 years to as little as 6 years. The facility is primarily for R&D rather than mass chip production, so it does not signal a direct near-term resurgence in U.S. chip manufacturing capacity, but is expected to strengthen Silicon Valley’s competitiveness in advanced semiconductors and AI chips. Applied Materials’ U.S. shares closed 2.88% lower on Tuesday, turned positive in after-hours trading, and are now up 0.74%, with its market capitalization rebounding to $8.3 billion.