St. Petersburg-based tech giant Jabil, the largest publicly traded company in the Tampa Bay region, will work with hardware and software company Calix in a new manufacturing deal to expand broadband internet service in rural America.
As part of the Biden Administration’s $42.45 billion Build America, Buy America (BABA) effort for the Broadband Equity, Access, and Deployment (BEAD) program, California-based Calix Inc. (NYSE: CALX) will work with U.S.-based manufacturers to produce parts.
Gerald “JJ” Creadon, senior vice president of operations at Jabil Inc. (NYSE: JBL), said Jabil will produce Calix’s optical network terminals (ONTs) and optical line terminals (OLTs) in Michigan.
“We manufacture things like electronic vehicles, health care [tech], renewable energy devices, internet infrastructure and 5G. Calix has worked with us for more than five years,” Creadon said during a Friday news briefing at Calix’s manufacturing facility in Auburn Hills, Michigan, which is operated by Jabil.
“We are proud to present leading-edge cloud platforms for them. Their optical line network and terminals will be built here in Auburn Hills in a dedicated location.”
Calix has invested $1.2 billion over the past 12 years to build the only end-to-end software and cloud broadband platform, and has more than 1,300 active U.S. customers, serving rural markets and closing the digital divide.
Calix plans to make an initial investment of $4 million to $6 million and an ongoing spend for operations of $10 million to $15 million per year, according to the announcement.
Calix also has an eight-year partnership with Gemtek and a 10-year partnership with Hisense Broadband.
Gemtek will produce ONTs at its California facility and Hisense Broadband will produce optical modules at its New Jersey hub.
The new jobs stem from funding made possible by the BEAD Program, which provides funding to states to expand high-speed internet access. The program is backed by the Bipartisan Infrastructure Bill Biden signed in late 2021.
The collaboration with the selected manufacturers will create more than 100 jobs. The providers will hire workers in manufacturing, operations, engineering, quality assurance and administrative roles as they ramp up Calix’s U.S. production lines.
The new partnership represents one of Jabil’s most recent major wins.
In late August, Jabil agreed to sell its mobility business in China to BYD Electronic for $2.2 billion.
Singapore-based Jabil Circuit, which manufactures printed circuit boards, established a unit that absorbed its product-manufacturing businesses in Chengdu and Wuxi, which will now be sold to the Chinese company, according to Reuters.
“This transformational deal would represent the largest transaction in the history of our company, and I am thrilled to be able to work with a reputable company like BYDE to drive this business successfully forward,” Jabil CEO Kenny Wilson said.
BYD Electronic is a subsidiary of Chinese automaker BYD. The BYD Electronic group is known for its work in the electric vehicle industry and assembling parts for smartphones, including Apple, tablets and other devices.
Jabil is preparing to release its latest earnings data Sept. 28. Analysts are projecting that the company will report earnings of $2.22 per share for this quarter.