GlobalFoundries Reports Third Quarter 2024 Financial Results
GlobalFoundries (GFS) reported Q3 2024 financial results with revenue of $1.739 billion, showing a 6% year-over-year decline but a 7% sequential increase. The company achieved a gross margin of 23.8% and net income of $178 million. Key metrics include operating margin of 10.6% and cash position of $4.3 billion. GF announced new collaborations with NXP Semiconductors utilizing their 22FDX® technology platform and a strategic agreement with Finwave Semiconductor for GaN technology development. The company maintains strong cash flow generation, projecting a threefold increase in year-over-year Non-IFRS adjusted free cash flow by end of 2024.
GlobalFoundries (GFS) ha riportato i risultati finanziari del terzo trimestre del 2024, con ricavi di 1,739 miliardi di dollari, mostrando un calo del 6% rispetto all'anno precedente ma un aumento del 7% rispetto al trimestre precedente. L'azienda ha raggiunto un margine lordo del 23,8% e un reddito netto di 178 milioni di dollari. I principali indicatori includono un margine operativo del 10,6% e una posizione di liquidità di 4,3 miliardi di dollari. GF ha annunciato nuove collaborazioni con NXP Semiconductors utilizzando la loro piattaforma tecnologica 22FDX® e un accordo strategico con Finwave Semiconductor per lo sviluppo della tecnologia GaN. L'azienda mantiene una forte generazione di flusso di cassa, prevedendo un aumento di tre volte del flusso di cassa libero aggiustato Non-IFRS rispetto all'anno precedente entro la fine del 2024.
GlobalFoundries (GFS) reportó los resultados financieros del tercer trimestre de 2024, con ingresos de 1,739 mil millones de dólares, lo que representa una disminución del 6% en comparación con el año anterior, pero un aumento del 7% en comparación con el trimestre anterior. La compañía alcanzó un margen bruto del 23.8% y un ingreso neto de 178 millones de dólares. Las métricas clave incluyen un margen operativo del 10.6% y una posición de efectivo de 4.3 mil millones de dólares. GF anunció nuevas colaboraciones con NXP Semiconductors utilizando su plataforma tecnológica 22FDX® y un acuerdo estratégico con Finwave Semiconductor para el desarrollo de tecnología GaN. La empresa mantiene una fuerte generación de flujo de efectivo, proyectando un aumento triple en el flujo de efectivo libre ajustado por Non-IFRS en comparación con el año anterior para finales de 2024.
GlobalFoundries (GFS)는 2024년 3분기 재무 성과를 보고하며 수익이 17억 3900만 달러에 이르렀다고 밝혔습니다. 전년 대비 6% 감소했지만 전분기 대비 7% 증가했습니다. 회사는 23.8%의 총 마진과 1억 7800만 달러의 순이익을 달성했습니다. 주요 지표로는 10.6%의 운영 마진과 43억 달러의 현금 보유액이 있습니다. GF는 NXP 반도체와 22FDX® 기술 플랫폼을 활용한 새로운 협업을 발표했으며, Finwave 반도체와의 전략적 협약을 통해 GaN 기술 개발을 추진한다고 합니다. 이 회사는 강력한 현금 흐름 생성을 유지하며, 2024년 말까지 전년 대비 비IFRS 조정 자유 현금 흐름을 3배 증가시킬 것으로 전망하고 있습니다.
GlobalFoundries (GFS) a annoncé ses résultats financiers pour le troisième trimestre de 2024, avec un chiffre d'affaires de 1,739 milliard de dollars, affichant une baisse de 6% par rapport à l'année précédente mais une hausse de 7% par rapport au trimestre précédent. L'entreprise a atteint une marge brute de 23,8% et un revenu net de 178 millions de dollars. Les indicateurs clés incluent une marge opérationnelle de 10,6% et une position de liquidité de 4,3 milliards de dollars. GF a annoncé de nouvelles collaborations avec NXP Semiconductors en utilisant leur plateforme technologique 22FDX®, ainsi qu'un accord stratégique avec Finwave Semiconductor pour le développement de la technologie GaN. L'entreprise maintient une forte génération de flux de trésorerie et projette une augmentation par trois de son flux de trésorerie libre ajusté selon les normes Non-IFRS d'ici à la fin de 2024.
GlobalFoundries (GFS) hat die Finanzergebnisse für das dritte Quartal 2024 veröffentlicht, mit einem Umsatz von 1,739 Milliarden Dollar, was einen Rückgang von 6% im Jahresvergleich, aber einen Anstieg von 7% im Vergleich zum Vorquartal bedeutet. Das Unternehmen erzielte eine Bruttomarge von 23,8% und einen Nettogewinn von 178 Millionen Dollar. Wichtige Kennzahlen umfassen eine operative Marge von 10,6% und eine liquiditätsposition von 4,3 Milliarden Dollar. GF gab neue Partnerschaften mit NXP Semiconductors bekannt, die ihre 22FDX®-Technologieplattform nutzen, sowie eine strategische Vereinbarung mit Finwave Semiconductor zur Entwicklung von GaN-Technologie. Das Unternehmen bleibt stark in der Generierung von Cashflow und prognostiziert eine dreifache Steigerung des Jahresvergleichs bei frei verfügbarem Cashflow nach Non-IFRS bis Ende 2024.
- Sequential revenue growth of 7% to $1.739 billion
- Strong cash position of $4.3 billion
- Year to date operating cash flow of $1.265 billion
- Strategic collaboration secured with NXP Semiconductors
- Projected threefold increase in adjusted free cash flow by year-end
- Year-over-year revenue decline of 6%
- Gross margin decreased 480 basis points year-over-year to 23.8%
- Operating profit declined 29% year-over-year to $185 million
- Net income dropped 29% year-over-year to $178 million
- Wafer shipments decreased 5% year-over-year
Insights
GlobalFoundries' Q3 results present a mixed picture with some concerning trends. Revenue of
The sequential improvement in Q3 and strong guidance for Q4 (
Key strategic wins with NXP and Finwave demonstrate GF's competitive position in specialty processes, particularly in automotive and GaN technology. However, margin pressure and declining shipments indicate ongoing industry challenges that may persist into 2024.
The semiconductor downcycle is evident in GF's results, with wafer shipments down
The collaboration with NXP leveraging 22FDX technology is strategically significant, supporting geographical supply chain diversification through dual-sourcing from Dresden and Malta. The Finwave partnership in GaN technology positions GF well in the growing power semiconductor market.
The focus on "AI Everywhere" at their Technology Summit indicates GF's push to capture AI-related opportunities in edge computing and IoT, though margin compression suggests pricing pressure in their core business segments.
MALTA, N.Y., Nov. 05, 2024 (GLOBE NEWSWIRE) -- GlobalFoundries Inc. (GF) (Nasdaq: GFS) today announced preliminary financial results for the third quarter ended September 30, 2024.
Key Third Quarter Financial Highlights
- Revenue of
$1.73 9 billion - Gross margin of
23.8% and Non-IFRS gross margin(1) of24.7% - Operating margin of
10.6% and Non-IFRS operating margin(1) of13.6% - Net income of
$178 million and Non-IFRS net income(1) of$229 million - Non-IFRS adjusted EBITDA(1) of
$627 million - Cash, cash equivalents and marketable securities of
$4.3 billion - Year to date net cash provided by operating activities of
$1,265 million and Non-IFRS adjusted free cash flow(1) of$779 million
"In the third quarter, the GF team continued to execute next generation opportunities with our customers, by securing key design wins across our growing portfolio of essential chip technologies,” said Dr. Thomas Caulfield, President and CEO of GF. "We delivered consistent financial results at the upper end of the guidance ranges we provided in our August earnings release, and as we continue to navigate the ongoing uncertainties facing our industry, we remain on-track to deliver approximately a threefold increase in our year-over-year Non-IFRS adjusted free cash flow generation by the end of 2024."
Recent Business Highlights
- Building on the longtime relationship between GF and NXP Semiconductors (NXP), the companies announced a new collaboration leveraging GF's 22FDX® process technology platform and global manufacturing footprint to optimize the power, performance and time-to-market of NXP's solutions across a range of automotive, IoT and smart mobile devices. GF's 22FDX chips will be manufactured in Dresden, Germany and Malta, New York, providing NXP geographically diverse supply for their customers.
- Over one thousand customers and partners attended GF’s annual Technology Summit held around the world in Santa Clara, California, Munich, Germany and Shanghai, China, to build deeper relationships and learn how GF's essential chips play a critical role in realizing “AI Everywhere.”
- GF entered into a strategic technology development and licensing agreement with Finwave Semiconductor, Inc (Finwave), a leading innovator in GaN technology. The collaboration will optimize and scale Finwave's cutting-edge GaN-on-Si technology to volume production at GF's 200mm fab in Burlington, Vermont.
(1) Non-IFRS gross profit, Non-IFRS operating profit, Non-IFRS net income, Non-IFRS adjusted EBITDA, Non-IFRS adjusted free cash flow and any related margins are all Non-IFRS measures. See “Reconciliation of IFRS to Non-IFRS" for a detailed reconciliation of Non-IFRS measures to the most directly comparable IFRS measure. See "Financial Measures (Non-IFRS)" for a discussion of why we believe these Non-IFRS measures are useful.
| Summary Quarterly Results (Unaudited, in millions, except per share amounts and wafer shipments) | |||||||||||||||||||||||
| Year-over-year | Sequential | ||||||||||||||||||||||
| Q3'24 | Q2'24 | Q3'23 | Q3'24 vs Q3'23 | Q3'24 vs Q2'24 | |||||||||||||||||||
| Net revenue | $ | 1,739 | $ | 1,632 | $ | 1,852 | $ | (113 | ) | (6)% | $ | 107 | 7 | % | |||||||||
| Gross profit | $ | 414 | $ | 395 | $ | 529 | $ | (115 | ) | (22)% | $ | 19 | 5 | % | |||||||||
| Gross margin | 23.8 | % | 24.2 | % | 28.6 | % | (480)bps | (40)bps | |||||||||||||||
| Non-IFRS gross profit(1) | $ | 429 | $ | 411 | $ | 541 | $ | (112 | ) | (21)% | $ | 18 | 4 | % | |||||||||
| Non-IFRS gross margin(1) | 24.7 | % | 25.2 | % | 29.2 | % | (450)bps | (50)bps | |||||||||||||||
| Operating profit | $ | 185 | $ | 155 | $ | 261 | $ | (76 | ) | (29)% | $ | 30 | 19 | % | |||||||||
| Operating margin | 10.6 | % | 9.5 | % | 14.1 | % | (350)bps | +110bps | |||||||||||||||
| Non-IFRS operating profit(1) | $ | 236 | $ | 212 | $ | 322 | $ | (86 | ) | (27)% | $ | 24 | 11 | % | |||||||||
| Non-IFRS operating margin(1) | 13.6 | % | 13.0 | % | 17.4 | % | (380)bps | +60bps | |||||||||||||||
| Net income | $ | 178 | $ | 155 | $ | 249 | $ | (71 | ) | (29)% | $ | 23 | 15 | % | |||||||||
| Net income margin | 10.2 | % | 9.5 | % | 13.4 | % | (320)bps | +70bps | |||||||||||||||
| Non-IFRS net income(1) | $ | 229 | $ | 211 | $ | 308 | $ | (79 | ) | (26)% | $ | 18 | 9 | % | |||||||||
| Non-IFRS net income margin(1) | 13.2 | % | 12.9 | % | 16.6 | % | (340)bps | +30bps | |||||||||||||||
| Diluted earnings per share ("EPS") | $ | 0.32 | $ | 0.28 | $ | 0.45 | $ | (0.13 | ) | (29)% | $ | 0.04 | 14 | % | |||||||||
| Non-IFRS diluted EPS(1) | $ | 0.41 | $ | 0.38 | $ | 0.55 | $ | (0.14 | ) | (25)% | $ | 0.03 | 8 | % | |||||||||
| Non-IFRS adjusted EBITDA(1) | $ | 627 | $ | 610 | $ | 667 | $ | (40 | ) | (6)% | $ | 17 | 3 | % | |||||||||
| Non-IFRS adjusted EBITDA margin(1) | 36.1 | % | 37.4 | % | 36.0 | % | +10bps | (130)bps | |||||||||||||||
| Cash from operating activities | $ | 375 | $ | 402 | $ | 416 | $ | (41 | ) | (10)% | $ | (27 | ) | (7)% | |||||||||
| Wafer shipments (300mm equivalent) (in thousands) | 549 | 517 | 575 | (26 | ) | (5)% | 32 | 6 | % | ||||||||||||||
(1) Non-IFRS gross profit, Non-IFRS operating profit, Non-IFRS net income, Non-IFRS diluted EPS, Non-IFRS adjusted EBITDA and any related margins are all Non-IFRS measures. See "Reconciliation of IFRS to Non-IFRS" section for a detailed reconciliation of Non-IFRS measures to the most directly comparable IFRS measure. See "Financial Measures (Non-IFRS)" for a discussion of why we believe these Non-IFRS measures are useful.
| Summary of Fourth Quarter 2024 Guidance (Unaudited, in millions, except per share amounts)(1) | ||||||
| IFRS | Share-based compensation | Non-IFRS (2) | ||||
| Net revenue | — | |||||
| Gross profit | ||||||
| Gross margin(3) (mid-point) | 24.3% | 25.0% | ||||
| Operating profit | ||||||
| Operating margin(3) (mid-point) | 11.9% | 14.6% | ||||
| Net income (4) | ||||||
| Net income margin(3) (mid-point) | 10.9% | 13.6% | ||||
| Diluted EPS | ||||||
(1) The Guidance provided contains forward-looking statements as defined in the U.S. Private Securities Litigation Act of 1995, and is subject to the safe harbors created therein. The Guidance includes management's beliefs and assumptions and is based on information that is currently available.
(2) Non-IFRS gross profit, Non-IFRS operating expense, Non-IFRS operating profit, Non-IFRS net income and Non-IFRS diluted EPS are Non-IFRS measures and, for purposes of the Guidance only, are defined as gross profit, operating profit, net income and EPS before share-based compensation, respectively. Non-IFRS operating expense is calculated by subtracting Non-IFRS operating profit from Non-IFRS gross profit.
(3) Non-IFRS margins are Non-IFRS measures and for purposes of the Guidance only, are defined as Non-IFRS gross profit, Non-IFRS operating profit and Non-IFRS net income, each divided by net revenue (using the definitions of Non-IFRS gross profit, Non-IFRS operating profit and Non-IFRS net income, in footnote (2) above, as appropriate).
(4) Included in net income is net interest income and other income and expense which we estimate will be between
| Consolidated Statements of Operations (Unaudited, in millions, except for per share amounts) | ||||||||
| Three Months Ended | ||||||||
| September 30, 2024 | September 30, 2023 | |||||||
| Net revenue | $ | 1,739 | $ | 1,852 | ||||
| Cost of revenue | 1,325 | 1,323 | ||||||
| Gross profit | $ | 414 | $ | 529 | ||||
| Operating expenses: | ||||||||
| Research and development | 130 | 108 | ||||||
| Selling, general and administrative(1) | 98 | 143 | ||||||
| Restructuring charges | 1 | 17 | ||||||
| Total operating expenses | $ | 229 | $ | 268 | ||||
| Operating profit | $ | 185 | $ | 261 | ||||
| Finance income (expense), net | 15 | 3 | ||||||
| Other income (expense) | (5 | ) | (21 | ) | ||||
| Income tax expense | (17 | ) | 6 | |||||
| Net income | $ | 178 | $ | 249 | ||||
| Attributable to: | ||||||||
| Shareholders of GlobalFoundries | 177 | 249 | ||||||
| Non-controlling interest | 1 | — | ||||||
| EPS: | ||||||||
| Basic | $ | 0.32 | $ | 0.45 | ||||
| Diluted | $ | 0.32 | $ | 0.45 | ||||
| Shares used in EPS calculation: | ||||||||
| Basic | 552 | 553 | ||||||
| Diluted | 555 | 556 | ||||||
(1) Beginning in Q3 2023, selling, general and administrative includes (gain)/loss on tool sales and certain contract cancellation fees. Prior period amounts have not been adjusted, as they are immaterial.
| Condensed Consolidated Statements of Financial Position (Unaudited, in millions) | ||||||||
| September 30, 2024 | December 31, 2023 | |||||||
| Assets: | ||||||||
| Cash and cash equivalents | $ | 2,286 | $ | 2,387 | ||||
| Marketable securities | 1,187 | 1,033 | ||||||
| Receivables, prepayments and other | 1,323 | 1,420 | ||||||
| Inventories | 1,802 | 1,487 | ||||||
| Current assets | $ | 6,598 | $ | 6,327 | ||||
| Deferred tax assets | $ | 197 | $ | 241 | ||||
| Property, plant and equipment, net | 8,950 | 9,829 | ||||||
| Right of use assets | 492 | 335 | ||||||
| Marketable securities | 860 | 468 | ||||||
| Other assets | 1,008 | 844 | ||||||
| Non-current assets | $ | 11,507 | $ | 11,717 | ||||
| Total assets | $ | 18,105 | $ | 18,044 | ||||
| Liabilities and equity: | ||||||||
| Current portion of long-term debt | $ | 541 | $ | 571 | ||||
| Other current liabilities | 2,182 | 2,528 | ||||||
| Current liabilities | $ | 2,723 | $ | 3,099 | ||||
| Non-current portion of long-term debt | $ | 1,772 | $ | 1,801 | ||||
| Non-current portion of lease obligations | 443 | 350 | ||||||
| Other liabilities | 1,585 | 1,643 | ||||||
| Non-current liabilities | $ | 3,800 | $ | 3,794 | ||||
| Total liabilities | $ | 6,523 | $ | 6,893 | ||||
| Shareholders' equity: | ||||||||
| Common stock / additional paid-in capital | $ | 23,982 | $ | 24,038 | ||||
| Accumulated deficit | (12,536 | ) | (13,001 | ) | ||||
| Accumulated other comprehensive income | 87 | 67 | ||||||
| Non-controlling interest | 49 | 47 | ||||||
| Total liabilities and equity | $ | 18,105 | $ | 18,044 | ||||
| Condensed Consolidated Statements of Cash Flows (Unaudited, in millions) | |||||||
| Three Months Ended | |||||||
| September 30, 2024 | September 30, 2023 | ||||||
| Operating Activities: | |||||||
| Net income | $ | 178 | $ | 249 | |||
| Depreciation and amortization | 396 | 366 | |||||
| Finance (income) expense, net and other | 12 | 7 | |||||
| Deferred income taxes | 37 | (4 | ) | ||||
| Other non-cash operating activities | 15 | 16 | |||||
| Net change in working capital | (263 | ) | (218 | ) | |||
| Net cash provided by operating activities | $ | 375 | $ | 416 | |||
| Investing Activities: | |||||||
| Purchases of property, plant equipment, and intangible assets | $ | (162 | ) | $ | (323 | ) | |
| Acquisitions, net of cash acquired | (69 | ) | — | ||||
| Other investing activities | (32 | ) | 10 | ||||
| Net cash used in investing activities | $ | (263 | ) | $ | (313 | ) | |
| Financing Activities: | |||||||
| Proceeds (repayment) of debt, net | $ | (10 | ) | $ | (54 | ) | |
| Other financing activities | (2 | ) | 1 | ||||
| Net cash used in financing activities | $ | (12 | ) | $ | (53 | ) | |
| Effect of exchange rate changes | 2 | (2 | ) | ||||
| Net change in cash and cash equivalents | $ | 102 | $ | 48 | |||
| Cash and cash equivalents at the beginning of the period | 2,184 | 1,832 | |||||
| Cash and cash equivalents at the end of the period | $ | 2,286 | $ | 1,880 | |||
| Reconciliation of IFRS to Non-IFRS (Unaudited, in millions, except for per share amounts) | ||||||||||||
| Three Months Ended | ||||||||||||
| September 30, 2024 | June 30, 2024 | September 30, 2023 | ||||||||||
| Net Revenue | $ | 1,739 | $ | 1,632 | $ | 1,852 | ||||||
| Gross profit | $ | 414 | $ | 395 | $ | 529 | ||||||
| Gross margin | 23.8 | % | 24.2 | % | 28.6 | % | ||||||
| Share-based compensation | 15 | 16 | 12 | |||||||||
| Non-IFRS gross profit(1) | $ | 429 | $ | 411 | $ | 541 | ||||||
| Non-IFRS gross margin(1) | 24.7 | % | 25.2 | % | 29.2 | % | ||||||
| Selling, general and administrative(2) | $ | 98 | $ | 114 | $ | 143 | ||||||
| Share-based compensation | 27 | 28 | 25 | |||||||||
| Non-IFRS selling, general and administrative(1) | $ | 71 | $ | 86 | $ | 118 | ||||||
| Research and development | $ | 130 | $ | 121 | $ | 108 | ||||||
| Share-based compensation | 8 | 8 | 7 | |||||||||
| Non-IFRS research and development(1) | $ | 122 | $ | 113 | $ | 101 | ||||||
| Operating profit | $ | 185 | $ | 155 | $ | 261 | ||||||
| Operating margin | 10.6 | % | 9.5 | % | 14.1 | % | ||||||
| Share-based compensation | 50 | 52 | 44 | |||||||||
| Restructuring charges | 1 | 5 | 17 | |||||||||
| Non-IFRS operating profit(1) | $ | 236 | $ | 212 | $ | 322 | ||||||
| Non-IFRS operating margin(1) | 13.6 | % | 13.0 | % | 17.4 | % | ||||||
| Net income | $ | 178 | $ | 155 | $ | 249 | ||||||
| Net income margin | 10.2 | % | 9.5 | % | 13.4 | % | ||||||
| Share-based compensation | 50 | 52 | 44 | |||||||||
| Restructuring charges | 1 | 5 | 17 | |||||||||
| Income tax effect(3) | — | (1 | ) | (2 | ) | |||||||
| Non-IFRS net income(1) | $ | 229 | $ | 211 | $ | 308 | ||||||
| Non-IFRS net income margin(1) | 13.2 | % | 12.9 | % | 16.6 | % | ||||||
| Diluted EPS | $ | 0.32 | $ | 0.28 | $ | 0.45 | ||||||
| Share-based compensation | 0.09 | 0.09 | 0.08 | |||||||||
| Restructuring charges | — | 0.01 | 0.03 | |||||||||
| Income tax effect(3) | — | — | (0.01 | ) | ||||||||
| Diluted shares outstanding | 555 | 557 | 556 | |||||||||
| Non-IFRS diluted EPS(1) | $ | 0.41 | $ | 0.38 | $ | 0.55 | ||||||
(1) Non-IFRS gross profit, Non-IFRS selling, general and administrative, Non-IFRS research and development, Non-IFRS operating profit, Non-IFRS operating expense (calculated by subtracting Non-IFRS operating profit from Non-IFRS gross profit), Non-IFRS net income, Non-IFRS diluted EPS and any related margins are all Non-IFRS measures. See “Financial Measures (Non-IFRS)” for a discussion of why we believe these Non-IFRS measures are useful.
(2) Beginning in Q3 2023, selling, general and administrative includes (gain)/loss on tool sales and certain contract cancellation fees. Prior period amounts have not been adjusted, as they are immaterial.
(3) Relates to restructuring charges.
| Reconciliation of IFRS to Non-IFRS Non-IFRS Adjusted Free Cash Flow(1) (Unaudited, in millions) | ||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||
| September 30, 2024 | June 30, 2024 | September 30, 2023 | September 30, 2024 | September 30, 2023 | ||||||||||||||||
| Net cash provided by operating activities | $ | 375 | $ | 402 | $ | 416 | $ | 1,265 | $ | 1,441 | ||||||||||
| Less: Purchase of property, plant and equipment and intangible assets | (162 | ) | (101 | ) | (323 | ) | (490 | ) | (1,576 | ) | ||||||||||
| Add: Proceeds from government grants | 3 | 1 | — | 4 | — | |||||||||||||||
| Non-IFRS adjusted free cash flow(2) | $ | 216 | $ | 302 | $ | 93 | $ | 779 | $ | (135 | ) | |||||||||
(1) Non-IFRS adjusted free cash flow is a Non-IFRS measure. See “Financial Measures (Non-IFRS)” for a discussion of why we believe these Non-IFRS measures are useful.
(2) Beginning Q1 2024 Non-IFRS adjusted free cash flow includes proceeds from government grants related to capital expenditures. This change in methodology is in anticipation of future expected proceeds from government grants related to capital expenditures from the planned funding awarded under the U.S. CHIPS and Science Act and the New York State Green CHIPS, and better aligns our Non-IFRS adjusted free cash flow metric to how GF assesses capital decisions internally. As such, prior periods have not been adjusted to reflect this new calculation methodology.
| Reconciliation of IFRS to Non-IFRS Non-IFRS Adjusted EBITDA (Unaudited, in millions) | ||||||||||||
| Three Months Ended | ||||||||||||
| September 30, 2024 | June 30, 2024 | September 30, 2023 | ||||||||||
| Net revenue | $ | 1,739 | $ | 1,632 | $ | 1,852 | ||||||
| Net income for the period | 178 | 155 | 249 | |||||||||
| Net income margin | 10.2 | % | 9.5 | % | 13.4 | % | ||||||
| Depreciation and amortization | 396 | 402 | 366 | |||||||||
| Finance expense | 37 | 37 | 37 | |||||||||
| Finance income | (52 | ) | (53 | ) | (40 | ) | ||||||
| Income tax expense (benefit) | 17 | 12 | (6 | ) | ||||||||
| Share-based compensation | 50 | 52 | 44 | |||||||||
| Restructuring charges | 1 | 5 | 17 | |||||||||
| Non-IFRS adjusted EBITDA(1)(2) | $ | 627 | $ | 610 | $ | 667 | ||||||
| Non-IFRS adjusted EBITDA margin(1)(2) | 36.1 | % | 37.4 | % | 36.0 | % | ||||||
(1) For the periods presented, there were no labor optimization expenses or divestiture gains and associated expenses, legal settlements and transaction expenses.
(2) Non-IFRS adjusted EBITDA and any related margin are Non-IFRS measures. See “Financial Measures (Non-IFRS)" for a discussion of why we believe these Non-IFRS measures are useful.
Financial Measures (Non-IFRS)
In addition to the financial information presented in accordance with International Financial Reporting Standards ("IFRS"), this press release includes the following Non-IFRS measures: Non-IFRS gross profit, Non-IFRS operating profit, Non-IFRS operating expense, Non-IFRS net income, Non-IFRS selling, general and administrative, Non-IFRS research and development, Non-IFRS diluted earnings per share (“EPS”), Non-IFRS adjusted EBITDA, Non-IFRS adjusted free cash flow and any related margins. We define each of Non-IFRS gross profit, Non-IFRS selling, general and administrative and Non-IFRS research and development as each respective IFRS measure adjusted for share-based compensation. We define Non-IFRS operating profit as operating profit adjusted for share-based compensation and restructuring charges. We define Non-IFRS operating expense as Non-IFRS gross profit minus Non-IFRS operating profit. We define Non-IFRS net income as net income adjusted for share-based compensation, restructuring charges and the associated tax impact. We define Non-IFRS diluted EPS as Non-IFRS net income divided by the diluted shares outstanding. We define Non-IFRS adjusted free cash flow as cash flow provided by (used in) operating activities less purchases of property, plant and equipment and intangible assets plus proceeds from government grants related to capital expenditures. We define Non-IFRS adjusted EBITDA as net income, adjusted for the impact of finance expense, finance income, income tax expense (benefit), depreciation and amortization, share-based compensation, restructuring charges, labor optimization initiatives and divestiture gains and associated expenses, legal settlements and transaction expenses. We define Non-IFRS gross margin as Non-IFRS gross profit divided by revenue. We define Non-IFRS operating margin as Non-IFRS operating profit divided by net revenue. We define Non-IFRS adjusted EBITDA margin as Non-IFRS adjusted EBITDA divided by net revenue.
We believe that in addition to our results determined in accordance with IFRS, these Non-IFRS measures provide useful information to both management and investors in measuring our financial performance and highlight trends in our business that may not otherwise be apparent when relying solely on IFRS measures. These Non-IFRS financial measures provide supplemental information regarding our operating performance that excludes certain gains, losses and non-cash charges that occur relatively infrequently and/or that we consider to be unrelated to our core operations. Management believes that Non-IFRS adjusted free cash flow as a Non-IFRS measure is helpful to investors as it provides insights into the nature and amount of cash the Company generates in the period. For further information regarding these Non-IFRS measures, please refer to the "Reconciliation of IFRS to Non-IFRS" tables.
Non-IFRS financial information is presented for supplemental informational purposes only and should not be considered in isolation or as a substitute for financial information presented in accordance with IFRS. Our presentation of Non-IFRS measures should not be construed as an inference that our future results will be unaffected by unusual or nonrecurring items. Other companies in our industry may calculate these measures differently, which may limit their usefulness as a comparative measure.
Conference Call and Webcast Information
GF will host a conference call with the financial community on Tuesday, November 5, 2024 at 8:30 a.m. U.S. Eastern Time (ET) to review the third quarter 2024 results in detail. Interested parties may join the scheduled conference call by registering at https://register.vevent.com/register/BI956a6ac1895c4c5fb6287253c584e9bc.
The call will be webcast and can be accessed from the GF Investor Relations website https://investors.gf.com. A replay of the call will be available on the GF Investor Relations website within 24 hours of the actual call.
About GlobalFoundries
GlobalFoundries® (GF®) is one of the world’s leading semiconductor manufacturers. GF is redefining innovation and semiconductor manufacturing by developing and delivering feature-rich process technology solutions that provide leadership performance in pervasive high growth markets. GF offers a unique mix of design, development and fabrication services. With a talented and diverse workforce and an at-scale manufacturing footprint spanning the U.S., Europe and Asia, GF is a trusted technology source to its worldwide customers. For more information, visit www.gf.com.
Forward-looking Statements
This press release includes “forward-looking statements” that reflect our current expectations and views of future events. These forward-looking statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995 and include but are not limited to, statements regarding our financial outlook, future guidance, product development, business strategy and plans, and market trends, opportunities and positioning. These statements are based on current expectations, assumptions, estimates, forecasts, projections and limited information available at the time they are made. Words such as “expect,” “anticipate,” “should,” “believe,” “hope,” “target,” “project,” “goals,” “estimate,” “potential,” “predict,” “may,” “will,” “might,” “could,” “intend,” “shall,” "outlook," "on track" and variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements, although not all forward-looking statements contain these identifying words. Forward-looking statements are subject to a broad variety of risks and uncertainties, both known and unknown. Any inaccuracy in our assumptions and estimates could affect the realization of the expectations or forecasts in these forward-looking statements. For example, our business could be impacted by geopolitical conditions such as the ongoing political and trade tensions with China and the wars in Ukraine and Israel; domestic political developments, including with respect to the U.S. presidential election; the market for our products may develop or recover more slowly than expected or than it has in the past; we may fail to achieve the full benefits of our restructuring plan; our operating results may fluctuate more than expected; there may be significant fluctuations in our results of operations and cash flows related to our revenue recognition or otherwise; a network or data security incident that allows unauthorized access to our network or data or our customers’ data could result in a system disruption, loss of data or damage our reputation; we could experience interruptions or performance problems associated with our technology, including a service outage; global economic conditions could deteriorate, including due to increasing interest rates, rising inflation and any potential recession; and our expected results and planned expansions and operations may not proceed as planned if funding we expect to receive (including the planned awards under the U.S. CHIPS and Science Act and New York State Green CHIPS) is delayed or withheld for any reason. It is not possible for us to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results or outcomes to differ materially from those contained in any forward-looking statements we may make. Moreover, we operate in a competitive and rapidly changing market, and new risks may emerge from time to time. You should not rely upon forward-looking statements as predictions of future events. These statements are based on our historical performance and on our current plans, estimates and projections in light of information currently available to us, and therefore you should not place undue reliance on them.
Although we believe that the expectations reflected in our statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events and circumstances described in the forward-looking statements will be achieved or occur. Moreover, neither we, nor any other person, assumes responsibility for the accuracy and completeness of these statements. Recipients are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date such statements are made and should not be construed as statements of fact. Except to the extent required by federal securities laws, we undertake no obligation to update any information or any forward-looking statements as a result of new information, subsequent events or any other circumstances after the date hereof, or to reflect the occurrence of unanticipated events. For a discussion of potential risks and uncertainties, please refer to the risk factors and cautionary statements in our 2023 Annual Report on Form 20-F, current reports on Form 6-K and other reports filed with the Securities and Exchange Commission (SEC). Copies of our SEC filings are available on our Investor Relations website, investors.gf.com, or from the SEC website, www.sec.gov.
For further information, please contact:
Investor Relations
ir@gf.com
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