GlobalFoundries (GF), AMD's old Dresden plant controlled by Abu Dhabi since February and now turned contract manufacturer, is going to make chips for Swiss-based STMicroelectronics (STM), its second customer after AMD.

It did not disclose terms, or the quantities of the 40nm low-power bulk silicon it's supposed to produce starting next year. The widgetry, based on STM technology, is meant for wireless, handheld and consumer electronics.

The contract will help keep the ovens stoked.

STM is the fifth-largest semiconductor company in the world.

Barclays Capital describes the deal as an "important milestone in developing a roadmap to both reducing loss levels from the Foundry business and eventually separating the AMD Product and Design company from GlobalFoundries."

AMD, which owns a minority 34.2% of GF, absorbs 83% of the GF's losses on its income statement.

Barclays, which is expecting other customer wins this half, figures STM will be using GF as a second source.

GF also broke ground last Friday on that $4.2 billion state-of-the-art factory that AMD promised to build in upstate New York, adding 5,000 jobs to the region.

It should be ready to spit out chips in 2012 provided there's demand.