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GlobalFoundries Stock Jumps After Earnings Beat Expectations
GlobalFoundries stock surged after the company reported earnings that exceeded both management's guidance and the Wall Street consensus forecast. The contract chip manufacturer posted sales for the quarter of $1.55 billion, down 16% from a year earlier, but ahead of the Street consensus expectation of $1.52 billion. Adjusted profits were 31 cents a share, surpassing the guidance range of 18 to 28 cents a share.
The company also reported that a glut of inventory in some key end markets has begun to ease, with CEO Thomas Caulfield stating that the semiconductor industry is beginning to emerge from the inventory correction. CFO John Hollister noted that inventory levels in end markets vary widely, with the company expecting to post top-line growth in the automotive segment this year.
GlobalFoundries projected second-quarter revenue of between $1.59 billion and $1.64 billion, with adjusted profits of 24 to 34 cents a share. Despite being in line to receive funding from the Chips Act to build new U.S. chipmaking capacity, the company stated that there is no urgency to do so at the moment.
Overall, GlobalFoundries' positive earnings report and optimistic outlook for the future have led to a significant increase in its stock value, with shares up about 9% on the news.
