GLOBALFOUNDRIES Q4 Earnings Exceed Expectations
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Should l Buy GFS?
Source: seekingalpha
- Strong Earnings Performance: GLOBALFOUNDRIES reported a Q4 non-GAAP EPS of $0.55, beating expectations by $0.08, indicating robust profitability that is likely to positively impact stock prices.
- Stable Revenue: The company posted revenue of $1.83 billion, flat year-over-year but exceeding market expectations by $30 million, demonstrating its ability to maintain steady revenue streams in a competitive semiconductor market.
- Margin Improvement: The gross margin for Q4 was 27.8%, with a non-IFRS gross margin of 29.0%, reflecting successful cost control and operational efficiency, which may enhance investor confidence.
- Healthy Cash Flow: Net cash provided by operating activities was $374 million, with non-IFRS adjusted free cash flow at $264 million, showcasing a strong cash position that supports future investment and expansion plans.
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Analyst Views on GFS
Wall Street analysts forecast GFS stock price to fall
9 Analyst Rating
2 Buy
5 Hold
2 Sell
Hold
Current: 48.700
Low
35.00
Averages
38.88
High
45.00
Current: 48.700
Low
35.00
Averages
38.88
High
45.00
About GFS
GlobalFoundries Inc. is a semiconductor manufacturer. The Company offers a range of mainstream wafer fabrication services and technologies. It manufactures a range of semiconductor devices, including microprocessors, mobile application processors, baseband processors, network processors, radio frequency modems, microcontrollers, and power management units. Its specialized foundry manufacturing processes include a library consisting of qualified circuit-building block designs (known as IP titles or IP blocks), and advanced transistor and device technology. The Company's differentiated technology platforms include radio frequency (RF) silicon-on-insulator (SOI), Fin Field-Effect Transistor (FinFET), FDX, Complementary Metal-Oxide Semiconductor (CMOS), Silicon Germanium (SiGe), Gallium Nitride (GaN), Bipolar-CMOS-DMOS (BCD), and Silicon Photonics (SiPh).
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Earnings Beat: The company’s adjusted EPS of 55 cents surpassed the analyst estimate of 47 cents, reflecting improved cost control and operational efficiency, which further bolsters investor confidence in its profitability.
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- Corporate Earnings Performance: So far, 78% of the 319 S&P 500 companies have reported earnings that beat expectations, with Q4 earnings growth projected at 8.4%, demonstrating corporate resilience that may support the stock market.
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- Strong Performance: GlobalFoundries reported a revenue of $1.830 billion for Q4 2025, flat year-over-year but exceeding the analyst consensus of $1.803 billion, indicating stability in the contract chip manufacturing sector and resilience in market demand.
- Earnings Beat: The company’s adjusted EPS of 55 cents surpassed the analyst estimate of 47 cents, reflecting improved cost control and operational efficiency, which further bolsters investor confidence in its profitability.
- Optimistic Outlook: GlobalFoundries expects first-quarter revenue between $1.600 billion and $1.650 billion, slightly below the analyst consensus of $1.611 billion, yet the adjusted EPS forecast of 30 to 40 cents indicates confidence in future performance.
- Analyst Rating Upgrades: Following the earnings announcement, analysts from Baird and Needham raised their price targets for GlobalFoundries, with Baird increasing from $40 to $60 and Needham from $42 to $55, reflecting market recognition of the company’s growth potential.
See More
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- Strong Employment Data: US nonfarm payrolls for January increased by 130,000, surpassing expectations of 65,000, indicating labor market stability, while the unemployment rate unexpectedly fell by 0.1% to 4.3%, which is likely to have a positive impact on economic recovery.
- Interest Rate Expectations Shift: Following the robust employment report, the market's expectation for a Fed rate cut next month dropped from 23% to 6%, with the 10-year T-note yield rising by 3 basis points to 4.17%, reflecting a cautious outlook on future monetary policy.
- Mixed Market Performance: The S&P 500 closed unchanged, the Nasdaq 100 rose by 0.29%, while the Dow Jones Industrial Average fell by 0.13%, highlighting a contrast between strong tech stock performance and weakness in software stocks.
- Optimistic Earnings Outlook: Over 78% of the 335 S&P 500 companies that reported earnings exceeded expectations, with Q4 earnings growth projected at 8.4%, indicating that sustained corporate profitability will support long-term stock market gains.
See More
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- Earnings Beat: GlobalFoundries reported revenue of $1.830 billion, flat year-over-year but exceeding the analyst consensus estimate of $1.803 billion, demonstrating resilience and competitive strength in the market.
- Margin Improvement: The adjusted gross margin rose by 360 basis points year-over-year to 29.0%, while the adjusted operating margin increased by 270 basis points to 18.3%, indicating significant progress in cost control and operational efficiency.
- Strategic Transformation: CEO Tim Breen emphasized that the company is at a pivotal “inflection point,” transitioning from a traditional foundry to a holistic technology solutions provider, particularly investing in “Physical AI,” which is expected to drive future growth.
- Positive Outlook: The company expects first-quarter revenue between $1.600 billion and $1.650 billion, with adjusted EPS projected at 30 to 40 cents, reflecting management's confidence in future performance despite supply chain and global regulatory risks.
See More
US Stocks Mixed as Software Sector Declines
- Strong Employment Data: US nonfarm payrolls rose by 130,000 in January, exceeding expectations of 65,000, while the unemployment rate unexpectedly fell by 0.1% to 4.3%, indicating labor market stability that could influence Fed policy decisions.
- Interest Rate Expectations Shift: Following the stronger-than-expected jobs report, the 10-year T-note yield increased by 3 basis points to 4.17%, with market expectations for a Fed rate cut next month dropping from 23% to 8%, reflecting investor caution regarding future monetary policy.
- Corporate Earnings Performance: So far, 78% of the 319 S&P 500 companies have reported earnings that beat expectations, with Q4 earnings growth projected at 8.4%, demonstrating corporate resilience that may support the stock market.
- Market Volatility Overview: The Dow Jones Industrial Average fell by 0.19%, the S&P 500 dipped 0.02%, while the Nasdaq 100 rose by 0.10%, indicating a mixed market performance amid declines in software stocks.
See More
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- Strong Nonfarm Payroll Data: The US added 130,000 jobs in January, exceeding expectations of 65,000, while the unemployment rate unexpectedly fell by 0.1% to 4.3%, indicating a stable labor market that could influence Fed rate decisions.
- Rising Bond Yields: Following the robust payroll report, the 10-year Treasury yield rose by 4 basis points to 4.18%, with market expectations for a Fed rate cut next month dropping from 23% to 6%, reflecting investor caution regarding future monetary policy.
- Mixed Corporate Earnings: Vertiv Holdings saw its stock rise over 23% after forecasting full-year net sales of $13.25 billion to $13.75 billion, significantly above consensus, while Mattel's stock fell over 27% due to weaker-than-expected 2026 adjusted EPS forecasts, highlighting market reactions to varying corporate performances.
- Market Focus on Economic Data: This week, the market will focus on corporate earnings and economic indicators, with initial jobless claims expected to drop by 7,000 to 224,000, and January CPI projected to rise by 2.5% year-over-year, which will further influence investor decisions.
See More
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- Revenue Expectations: The company's Q1 revenue exceeded estimates, contributing to the rise in share prices.
See More
