MALTA, New York, Aug. 08, 2023 (GLOBE NEWSWIRE) -- GlobalFoundries Inc. (GF) ( GFS) today announced preliminary financial results for the second quarter ended June 30, 2023.
Key Second Quarter Financial Highlights
- Revenue of $1,845 million.
- Gross margin of 28.8% and adjusted gross margin(1) of 29.6%.
- Operating margin of 14.9% and adjusted operating margin(1) of 18.3%.
- Net income of $237 million and adjusted net income(1) of $297 million.
- Adjusted EBITDA(1) of $668 million.
- Cash, cash equivalents and marketable securities of $3.3 billion.
"In the second quarter, GF delivered financial results at the upper end of the guidance ranges we provided in our May earnings release" said Dr. Thomas Caulfield, president and CEO of GF. "Despite the cyclical headwinds impacting our industry and continued macroeconomic uncertainty, we delivered consistent financial performance and generated $146 million of free cash flow in the quarter, as GF’s global teams diligently managed costs, while driving differentiated solutions to meet our customers' needs, across several critical growth markets."
Recent Business Highlights
- GF and Lockheed Martin announced a strategic collaboration to advance U.S. semiconductor manufacturing and innovation and to increase the security, reliability and resilience of domestic supply chains for national security systems.
- The U.S. Department of Defense accredited GF's advanced manufacturing facility in Malta, New York, as a Category 1A Trusted Supplier with the ability to manufacture secure semiconductors for a range of critical aerospace and defense applications.
(1) Adjusted gross profit, adjusted operating profit, adjusted net income, adjusted EBITDA and related margins are Non-IFRS measures. See “Unaudited 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.
| Unaudited Summary Quarterly Results (in millions USD, except per share amounts and wafer shipments) | |||||||||||||||||||||||
| Year-over-year | Sequential | ||||||||||||||||||||||
| Q2'23 | Q1'23 | Q2'22 | Q2'23 vs Q2'22 | Q2'23 vs Q1'23 | |||||||||||||||||||
| Net revenue | $ | 1,845 | $ | 1,841 | $ | 1,993 | $ | (148 | ) | (7)% | $ | 4 | — | % | |||||||||
| Gross profit | 532 | 515 | 538 | $ | (6 | ) | (1)% | $ | 17 | 3 | % | ||||||||||||
| Gross margin | 28.8 | % | 28.0 | % | 27.0 | % | +180bps | +80bps | |||||||||||||||
| Adjusted gross profit(1) | $ | 546 | $ | 525 | $ | 559 | $ | (13 | ) | (2)% | $ | 21 | 4 | % | |||||||||
| Adjusted gross margin (1) | 29.6 | % | 28.5 | % | 28.0 | % | +160bps | +110bps | |||||||||||||||
| Operating profit | $ | 275 | $ | 290 | $ | 297 | $ | (22 | ) | (7)% | $ | (15 | ) | (5)% | |||||||||
| Operating margin | 14.9 | % | 15.8 | % | 14.9 | % | 0bps | (90)bps | |||||||||||||||
| Adjusted operating profit(1) | $ | 338 | $ | 326 | $ | 350 | $ | (12 | ) | (3)% | $ | 12 | 4 | % | |||||||||
| Adjusted operating margin (1) | 18.3 | % | 17.7 | % | 17.6 | % | +70bps | +60bps | |||||||||||||||
| Net income | $ | 237 | $ | 254 | $ | 264 | $ | (27 | ) | (10)% | $ | (17 | ) | (7)% | |||||||||
| Net income margin | 12.8 | % | 13.8 | % | 13.2 | % | (40)bps | (100)bps | |||||||||||||||
| Adjusted net income(1)(2) | $ | 297 | $ | 290 | $ | 317 | $ | (20 | ) | (6)% | $ | 7 | 2 | % | |||||||||
| Adjusted net income margin (1) | 16.1 | % | 15.8 | % | 15.9 | % | +20bps | +30bps | |||||||||||||||
| Diluted earnings per share ("EPS") | $ | 0.43 | $ | 0.46 | $ | 0.48 | $ | (0.05 | ) | (10)% | $ | (0.03 | ) | (7)% | |||||||||
| Adjusted diluted earnings per share(1) | $ | 0.53 | $ | 0.52 | $ | 0.58 | $ | (0.05 | ) | (9)% | $ | 0.01 | 2 | % | |||||||||
| Adjusted EBITDA(1)(3) | $ | 668 | $ | 655 | $ | 784 | $ | (116 | ) | (15)% | $ | 13 | 2 | % | |||||||||
| Adjusted EBITDA margin (1) | 36.2 | % | 35.6 | % | 39.3 | % | (310)bps | +60bps | |||||||||||||||
| Cash from operations | $ | 546 | $ | 479 | $ | 609 | $ | (63 | ) | (10)% | $ | 67 | 14 | % | |||||||||
| Wafer shipments (300mm equivalent) (in thousands) | 573 | 511 | 630 | (57 | ) | (9)% | 62 | 12 | % | ||||||||||||||
| (1) Adjusted gross profit, adjusted operating profit, adjusted net income, adjusted diluted earnings per share, adjusted EBITDA, and related margins are all Non-IFRS measures. See "Unaudited 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 metrics are useful. | |||||||||||||||||||||||
| (2) Beginning in Q4 2022, the Company revised its definition of adjusted net income to include an adjustment for restructuring charges and the associated tax impact. The change was made due to a restructuring undertaken in Q4 2022. The Company believes the revised definition provides management and investors with more useful information to evaluate the operations of our business. Adjusted net income is now defined as net income adjusted for share-based compensation expense, restructuring charges and the associated tax impact. | |||||||||||||||||||||||
| (3) Beginning in Q3 2022, the Company revised its definition of adjusted EBITDA to include an adjustment for finance income. The change was made due to the Company making an investment during Q2 2022 of approximately $1.0 billion in marketable securities. The Company believes the revised definition provides management and investors more useful information to evaluate the operations of our business. Adjusted EBITDA is now defined as net income, adjusted for the impact of finance expense, finance income, income tax expense, depreciation, amortization, share-based compensation expense, divestiture gains and associated expenses, restructuring charges, labor optimization initiatives and litigation settlement. | |||||||||||||||||||||||
| Summary of Third Quarter 2023 Outlook (unaudited in millions USD, except per share amounts)(1) | |||||
| IFRS | Share-based compensation | Non-IFRS Adjusted(2) | |||
| Net revenue | $1,825 - $1,870 | — | — | ||
| Gross Profit | $485 - $527 | $15- $17 | $502 - $542 | ||
| Gross Margin(3) (mid-point) | 27.4% | 28.3% | |||
| Operating Profit | $227 - $287 | $40 - $50 | $277 - $327 | ||
| Operating Margin(3) (mid-point) | 13.9% | 16.3% | |||
| Net Income | |||||
