- Price
- $46.68
- Fair value
- $60.00
- Discount
- 22.2%
- Uncertainty
- High
- LSEG rating
- 2.26
- Moat
- None
- Next earnings
- 2026-11-04
- Next earnings is estimate
- No
- Company name
- GlobalFoundries
- Sector
- Semiconductor foundry
- About
- GlobalFoundries makes chips that other companies design. It is a contract manufacturer, or foundry, and it focuses on mature and specialty process technologies rather than the most advanced nodes. Its factories are in Malta, New York, Burlington, Vermont, Dresden, Germany, and Singapore. Its chips go into smartphones, cars, industrial equipment, communications networks and data centers. It sells special technologies such as silicon photonics and silicon germanium for optical networking in AI data centers, and power, radio frequency and embedded memory chips. In 2026, it bought the ARC processor business of Synopsys and the integrated voltage regulator business of Photeon, which add processor designs and power technology to its offer. Revenue was $1.786 billion in Q2 2026, and it shipped 625,000 300mm-equivalent wafers.
- Thesis
- The market prices GlobalFoundries as a maker of mature chips with no lasting advantage. Many foundries, including ones in China, make chips on similar older processes, and this limits prices. Its gross margin was 28.3% in Q2 2026, and large capital spending used up its cash flow: adjusted free cash flow was negative $3 million in Q2 2026. Revenue grew only 6% from a year earlier. The new US-Japan fab project in New York adds a chance for growth, but the first fab is not expected to start until 2029. For the gap to close, three things must be true. Revenue must keep growing, with Q3 2026 revenue near the $1,885 million guidance, as silicon photonics and other data center products grow. Gross margin must keep rising toward the 30.5% non-IFRS guidance for Q3 2026 and above. Free cash flow must turn clearly positive after capital spending, so that the dividend and new projects are funded from cash. The Q3 2026 report on November 4, 2026, and the 2027 outlook in February 2027 are the next tests. If they pass, the gap can close over the next four to eight quarters. The main reason it may not close is price pressure from Chinese foundries, which would keep margins and returns low.
- Risks
- Foundries in China and other countries make chips on similar mature processes and compete on price. More capacity in the industry can lower prices and margins.
Chip manufacturing needs large capital spending. In Q2 2026, purchases of property, plant and equipment were $411 million and adjusted free cash flow was negative. New fabs can raise spending before they add revenue.
Demand from smartphone, car and industrial customers changes with the economy and customer inventory. A downturn can lower factory use and margins.
The new fabs in New York depend on funding from Japan and agreements with the US government. Delays or changes in these agreements can change the value of the project.
- Balance sheet
- Cash: $3.3B
Debt: $1.1B
Net cash: $2.2B
Undrawn credit line: $1.5B, to August 2031
Debt due within 12 months: $98M
GlobalFoundries has more cash than debt. At June 30, 2026, cash and cash equivalents were $1,087 million and marketable securities were $1,270 million current and $946 million non-current, for about $3.3 billion. Debt was $1,122 million, of which $98 million was due within 12 months, plus lease obligations. On August 21, 2026, it signed a new $1.5 billion senior unsecured revolving credit facility to August 21, 2031, which requires consolidated leverage of no more than 4.0 times. In Q2 2026, cash from operations was $405 million, capital spending was $411 million and acquisitions used $440 million. Total equity was $11.9 billion against $16.9 billion of total assets. The quarterly dividend is $0.12 per share. GlobalFoundries agreed in September 2026 to issue 9,907,399 shares to the US Department of Commerce at $37.85 per share.
As of 2026-06-30.
- Checkpoints
- Nov 4, 2026: Q3 2026 results: revenue growth and margin. Pending. Watch: Revenue near $1,885 million, a non-IFRS gross margin near 30.5% and positive adjusted free cash flow pass; revenue below the guidance range or a lower margin fails.
Dec 2026 (estimate): Groundbreaking of the first new fab in Malta. Pending. Watch: Groundbreaking in late 2026 with signed funding terms from Japan passes; a delay or unclear funding fails.
Feb 2027 (estimate): Q4 2026 results and the 2027 outlook. Pending. Watch: A 2027 outlook with revenue growth, a higher gross margin and positive free cash flow passes; flat revenue or a lower margin fails.
- Recent events
- 2026-10-14: GlobalFoundries said it was selected as technology provider and operator for two new fabs at its Malta, New York, site under a US-Japan initiative with up to $21 billion of funding from Japan. The first fab, with about $10 billion of investment, is expected to start in 2029 and add about 900,000 300mm wafers of yearly capacity. GlobalFoundries also agreed with the US Department of Commerce to reallocate $955 million of its CHIPS Act award to silicon photonics, silicon germanium and advanced packaging.
2026-09-03: GlobalFoundries agreed to issue 9,907,399 ordinary shares to the US Department of Commerce at $37.85 per share. The government agreed not to vote the shares except on certain matters, such as a merger.
2026-08-21: GlobalFoundries signed a new $1.5 billion senior unsecured revolving credit facility that runs to August 21, 2031. It ended its old $1.0 billion facility, which had nothing drawn.
2026-08-05: GlobalFoundries reported Q2 2026 results. Revenue rose 6% to $1.786 billion, gross margin rose to 28.3% and diluted EPS was $0.30, or $0.46 on a non-IFRS basis. Adjusted EBITDA was $587 million. For Q3 2026, it guided revenue of $1,885 million plus or minus $25 million and non-IFRS EPS of $0.51 plus or minus $0.05.
2026-07-14: GlobalFoundries paid its first quarterly cash dividend, $0.12 per share.