Enovix Corp (NASDAQ:ENVX) shares dropped around 20% intra-day today after the company unveiled a strategic realignment of Fab1 in Fremont.
The company's announcement outlines its intention to transform Fab1 from a manufacturing hub into its "Center for Innovation", focused on new product development.
This aligns with Enovix's broader strategy of locating high-volume manufacturing in Asia near customers and suppliers while locating technology development activities in both Silicon Valley and Asia.
As a consequence of this shift, there will be a reduction in the Fremont workforce dedicated to 24/7 manufacturing, affecting approximately 185 personnel, including more than 125 contractors. Enovix anticipates completing this restructuring by Q4/23, with expected annualized savings of around $22 million.
“We do not take these decisions lightly and after careful consideration we determined these changes are necessary to set the company up for long-term success,” said Dr. Raj Talluri, President and CEO of Enovix. “It has become clear that Fremont is best positioned to be our Center for Innovation complementing our high-volume manufacturing in Asia.”