GlobalFoundries (NASDAQ:GFS) Posts Quarterly Earnings Results, Beats Estimates By $0.03 EPS

Key Points

• GlobalFoundries beat quarterly expectations: Adjusted EPS was $0.46 versus the $0.43 consensus, while revenue rose 5.8% year over year to $1.79 billion, slightly exceeding forecasts.
• AI-related demand is accelerating: Communications infrastructure and data-center revenue increased 62% year over year, with silicon photonics and silicon germanium capacity expected to drive significant growth through 2026 and beyond.
• Outlook remains mixed: GlobalFoundries raised its AI-related growth expectations and guided for third-quarter EPS of $0.46–$0.56, but mobile weakness, declining automotive revenue and a negative share-price reaction remain concerns.

GlobalFoundries (NASDAQ:GFS - Get Free Report) released its earnings results on Wednesday. The company reported $0.46 EPS for the quarter, beating analysts' consensus estimates of $0.43 by $0.03, FiscalAI reports. GlobalFoundries had a return on equity of 6.85% and a net margin of 11.40%.The company had revenue of $1.79 billion during the quarter, compared to analysts' expectations of $1.77 billion. During the same quarter last year, the business posted $0.42 EPS. The firm's revenue for the quarter was up 5.8% compared to the same quarter last year. GlobalFoundries updated its Q3 2026 guidance to 0.460-0.560 EPS.

Here are the key takeaways from GlobalFoundries' conference call:

• Strong Q2 execution: Revenue rose 6% year over year to $1.786 billion, while non-IFRS gross margin reached 29.9%, up nearly 500 basis points year over year and above guidance. Q3 revenue is expected to reach $1.885 billion at the midpoint, with gross margin advancing to approximately 30.5%.
• AI data-center demand accelerated: Communications infrastructure and data-center revenue increased 62% year over year in Q2, driven by silicon photonics and silicon germanium. GF raised its full-year 2026 growth outlook for the segment to 50%-60% and said SiGe capacity is oversubscribed through 2027.
• Capacity expansion and government support are advancing photonics: GF plans to add capacity within its existing fab footprint and expects silicon photonics revenue to more than double in 2026. A planned $300 million U.S. Department of Commerce award is expected to support next-generation photonics, packaging, and near-/co-packaged optics capabilities.
• Strategic investments broaden long-term opportunities: GF highlighted new engagements in quantum manufacturing, integrated voltage regulators for AI data centers, and the acquired MIPS/Synopsys ARC processor-IP businesses. These initiatives are expected to generate near-term technology-services revenue but require increased R&D spending and are largely longer-term growth bets.
• Mobile weakness remains a headwind: GF now expects smart-mobile-device revenue to decline by a low-teens percentage in 2026, primarily because of memory pricing and shortages. Automotive revenue also fell 13% sequentially in Q2, although management continues to expect low-double-digit growth for the full year.

GlobalFoundries Stock Performance

Shares of NASDAQ GFS traded down $2.56 during midday trading on Wednesday, hitting $49.46. 7,913,948 shares of the stock traded hands, compared to its average volume of 3,829,239. The company has a debt-to-equity ratio of 0.13, a quick ratio of 1.87 and a current ratio of 2.59. GlobalFoundries has a one year low of $31.51 and a one year high of $92.55. The firm has a market capitalization of $27.14 billion, a P/E ratio of 35.58, a PEG ratio of 1.84 and a beta of 1.80. The firm has a 50-day moving average of $70.24 and a two-hundred day moving average of $58.78.

GlobalFoundries Dividend Announcement

The business also recently announced a quarterly dividend, which will be paid on Friday, October 9th. Shareholders of record on Wednesday, September 23rd will be paid a dividend of $0.12 per share. The ex-dividend date is Wednesday, September 23rd. This represents a $0.48 dividend on an annualized basis and a yield of 1.0%. GlobalFoundries's payout ratio is currently 34.53%.

Analyst Upgrades and Downgrades

GFS has been the subject of a number of research reports. Weiss Ratings reiterated a "hold (c)" rating on shares of GlobalFoundries in a report on Friday, May 29th. JPMorgan Chase & Co. boosted their target price on shares of GlobalFoundries from $45.00 to $70.00 and gave the company a "neutral" rating in a report on Wednesday, May 6th. Loop Capital set a $80.00 target price on shares of GlobalFoundries in a research report on Monday, May 4th. Morgan Stanley set a $57.00 target price on GlobalFoundries in a report on Monday. Finally, Jefferies Financial Group set a $60.00 price target on shares of GlobalFoundries in a research note on Wednesday. One analyst has rated the stock with a Strong Buy rating, eight have assigned a Buy rating, nine have assigned a Hold rating and one has issued a Sell rating to the company's stock. According to MarketBeat.com, GlobalFoundries presently has an average rating of "Hold" and an average price target of $73.81.

Key Stories Impacting GlobalFoundries

Here are the key news stories impacting GlobalFoundries this week:

• Positive Sentiment: GlobalFoundries reported second-quarter adjusted EPS of $0.46, above the roughly $0.43–$0.44 analyst consensus, while revenue of $1.79 billion exceeded expectations of approximately $1.77 billion. Revenue increased 5.8% year over year. GlobalFoundries Reports Second Quarter 2026 Financial Results
• Positive Sentiment: Management said demand for chips used in AI-related data centers is growing, supporting the company’s specialty-chip and silicon-photonics growth opportunity. However, executives characterized the AI data-center business as still being in its “early innings,” implying substantial longer-term potential. GlobalFoundries tops second quarter estimates on AI chip demand
• Positive Sentiment: The company declared a quarterly dividend of $0.12 per share, payable October 9 to shareholders of record September 23. The annualized payout is approximately $0.48 per share, for a stated yield of about 1%.
• Neutral Sentiment: Third-quarter guidance calls for adjusted EPS of $0.46–$0.56 and revenue of about $1.9 billion. Revenue is broadly in line with consensus, while the EPS midpoint is above estimates but the low end is below them. GlobalFoundries Surpasses Q2 Earnings and Revenue Estimates
• Negative Sentiment: The market’s negative response indicates that the quarterly beat may not have been sufficient to justify elevated expectations surrounding AI infrastructure, data-center demand and silicon photonics. Investors may have been looking for a larger outlook improvement or clearer evidence of near-term AI acceleration.
• Negative Sentiment: Reported insider activity has been heavily weighted toward sales over the past six months, with 35 sales versus one purchase. While insider transactions may reflect personal liquidity needs, the imbalance can add to investor caution.

Insider Buying and Selling at GlobalFoundries

In other news, Director Glenda Dorchak sold 4,000 shares of the business's stock in a transaction on Monday, July 20th. The shares were sold at an average price of $58.22, for a total transaction of $232,880.00. Following the completion of the sale, the director owned 14,867 shares of the company's stock, valued at $865,556.74. The trade was a 21.20% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Samak L. Azar sold 335 shares of the firm's stock in a transaction on Thursday, July 2nd. The stock was sold at an average price of $77.36, for a total value of $25,915.60. Following the completion of the transaction, the insider directly owned 13,149 shares in the company, valued at approximately $1,017,206.64. This represents a 2.48% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 19,450 shares of company stock worth $1,412,000 in the last three months.

Institutional Inflows and Outflows

Institutional investors have recently made changes to their positions in the stock. Mercer Global Advisors Inc. ADV increased its stake in shares of GlobalFoundries by 85.5% in the fourth quarter. Mercer Global Advisors Inc. ADV now owns 29,768 shares of the company's stock worth $1,040,000 after purchasing an additional 13,718 shares in the last quarter. Vident Advisory LLC increased its stake in GlobalFoundries by 5.0% in the 4th quarter. Vident Advisory LLC now owns 6,160 shares of the company's stock worth $215,000 after buying an additional 293 shares in the last quarter. Empowered Funds LLC bought a new stake in GlobalFoundries during the fourth quarter valued at about $67,000. XTX Topco Ltd lifted its position in shares of GlobalFoundries by 247.7% in the fourth quarter. XTX Topco Ltd now owns 70,979 shares of the company's stock valued at $2,479,000 after acquiring an additional 50,564 shares in the last quarter. Finally, VARCOV Co. bought a new position in shares of GlobalFoundries in the fourth quarter worth about $470,000.

GlobalFoundries Company Profile

GlobalFoundries, Inc NASDAQ: GFS is a leading contract semiconductor manufacturer that provides wafer fabrication and related services to semiconductor companies and systems manufacturers. The company operates as a pure-play foundry, producing integrated circuits across a range of process technologies for customers in markets such as automotive, communications, consumer electronics, industrial, and aerospace. Its service offering spans process development, manufacturing, test and packaging support, and design enablement including process design kits (PDKs) and intellectual property (IP) libraries to help customers bring designs to production.

GlobalFoundries focuses on a portfolio of differentiated and specialty process nodes, offering technologies for radio-frequency (RF) and wireless, analog and mixed-signal, power management, embedded non-volatile memory, and silicon-on-insulator (SOI) process families.

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