GlobalFoundries Stock Jumps on Chipmaker’s Earnings, Bullish Outlook

Shares of GlobalFoundries (GFS) surged 15% Tuesday after the chipmaker reported better-than-expected earnings and issued a rosy outlook.

The company reported $1.74 billion in revenue for the third quarter, just above analysts’ estimates but down roughly 6% from the same time last year. Net income also beat estimates at $178 million, about $40 million better than expected but also down nearly 30% year-over-year.

Q4 Outlook Also Comes in Above Estimates

GlobalFoundries’ projections for the fourth quarter also came in above estimates, with the company expecting revenue between $1.8 billion and $1.85 billion, and profits between $161 million and $236 million. Analysts currently expect revenue of $1.79 billion and profits of $159.96 million, according to estimates compiled by Visible Alpha.

CEO Thomas Caulfield said the company notched “key design wins” in the quarter and said its estimate-beating results come despite the “ongoing uncertainties” facing the semiconductor industry.

The company was one of the manufacturers chosen for billions of dollars in federal funding to build and upgrade semiconductor manufacturing facilities, part of the Biden administration’s goal to make the U.S. a dominant semiconductor manufacturer. GlobalFoundries was picked to receive a $1.5 billion grant to build a new facility in New York and expand operations in Vermont.

GlobalFoundries shares, which hit a two-month high, were the top gainer in the Nasdaq Composite on Tuesday. Despite today’s big move, the stock has lost about a third of its value since the start of the year.