Tower Semiconductor revives shuttered Panasonic-era fab in $3 billion Japan photonics expansion — METI-backed plan targets $3.6 billion revenue by 2028

Tower Semiconductor has announced a dual-track expansion of its 300mm silicon photonics, silicon germanium, and advanced packaging operations in Japan, committing up to $3 billion net of grants with backing from the country's Ministry of Economy, Trade and Industry (METI). Alongside the announcement , the Israeli specialty foundry raised its 2028 business model to approximately $3.6 billion in revenue and $1.2 billion in net profit, and it says those targets rest entirely on the first of the plan's two tracks: reviving the shuttered Arai fab it inherited from Panasonic and maximizing its running 300mm fab in Uozu, Toyama Prefecture. Two tracks, one committed Track One converts the former Arai facility, designated Fab 6, into a 300mm silicon photonics and advanced optical packaging plant while expanding output at Fab 7 in Uozu, with full production readiness expected during the fourth quarter of 2027. The Arai plant ceased operations in July 2022 because it exclusively served Nuvoton Technology Corporation Japan (NTCJ) rather than Tower's foundry customers, according to Tower's SEC filings , leaving an intact fab shell sitting idle for four years. Track Two calls for constructing a new 300mm fab adjacent to Fab 7, which Tower says would deliver a multi-fold increase in silicon photonics and silicon germanium capacity and become "highly accretive beginning in 2029." The company hasn't signed definitive agreements for it, however, and none of the new 2028 targets depend on it. A restructuring of the TPSCo joint venture, announced in March 2026, cleared the way for all this. Tower entered Japan in 2014 by buying 51% of Panasonic's three-fab semiconductor manufacturing operation, and Panasonic sold its remaining stake to Nuvoton in 2020. Under the March agreement , Tower takes full ownership of the 300mm Fab 7, while NTCJ absorbs the 200mm operations and pays Tower $25 million, with closing expected on April 1, 2027. Sole ownership of Fab 7 removed the joint-venture stru