NXP Semiconductors has announced a significant strategic shift: the company will shut down its ECHO GaN wafer fabrication facility located in Chandler, Arizona, and withdraw entirely from the 5G RF Power (RP) market. The plant, which once symbolized NXP’s ambition to lead in next-generation 5G power amplifier technologies, is now scheduled to produce its final GaN wafer in Q1 2027.

A Short-Lived Flagship Fab

The ECHO Fab officially launched in September 2020, at the height of global enthusiasm for 5G rollouts. At that time, NXP positioned the facility as one of the most advanced GaN fabs in the industry, tasked with supplying high-efficiency GaN power amplifiers for 5G base stations.

NXP adopted GaN-on-Si technology as a successor to its long-standing LDMOS platform, aiming to deliver higher power density and efficiency for next-generation telecom equipment. However, despite the technological promise, market conditions shifted dramatically.

Why NXP Is Exiting the 5G RF Power Market

In its official statement, NXP cited sustained weakness in 5G infrastructure demand:

   *  5G deployment has slowed due to low ROI for mobile operators

   *  Global 5G base station build-outs remain far below initial forecasts

   *  The RF Power product line no longer aligns with NXP’s long-term strategy

As a result, the company will wind down its RF Power business, although NXP will continue providing GaN components to existing customers during the transition period.

Financial Context

NXP's “Communication Infrastructure & Other” segment—once its third-largest business—has been severely impacted:

   *  Revenue down nearly 20% last year

   *  Revenue down 25% YoY in the first nine months of this year

   *  Declines attributed to weaker processor, secure card, and RF Power product demand

This prolonged contraction underscores the structural slowdown of the 5G infrastructure cycle.

Impact on the Telecom Supply Chain

NXP's exit narrows the field of suppliers for 5G RF power amplifiers, particularly GaN-based solutions. For major telecom equipment manufacturers such as Ericsson and Nokia, the available supplier base becomes smaller, which may:

   *  Increase dependence on a limited number of GaN vendors

   *  Affect design flexibility for next-generation radio units

   *  Create potential long-term cost and supply risks

The move also reinforces a broader industry trend: the 5G infrastructure boom has peaked, and the ecosystem is consolidating as demand stabilizes at lower-than-expected levels.

What Happens Next?

NXP clarified that the decision affects only the ECHO GaN operations. Its other Chandler manufacturing facilities will continue to operate normally.

As the company reallocates resources toward businesses that align with its long-term roadmap—such as automotive, industrial, and secure connectivity—its departure from RF Power marks the end of a key chapter in its 5G strategy.