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 $1.739 billion
- Gross margin of 23.8% and Non-IFRS
gross margin(1) of 24.7%
- Operating margin of 10.6% and
Non-IFRS operating margin(1) of 13.6%
- 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 |
$1,800 - $1,850 |
|
— |
|
|
Gross profit |
$417 - $468 |
|
$13 - $15 |
|
$432 - $481 |
Gross margin(3) (mid-point) |
24.3% |
|
|
|
25.0% |
|
Operating profit |
$177 - $256 |
|
$45 - $55 |
|
$232 - $301 |
Operating margin(3) (mid-point) |
11.9% |
|
|
|
14.6% |
|
Net income
(4) |
$161 - $236 |
|
$45 - $55 |
|
$216 - $281 |
Net income margin(3) (mid-point) |
10.9% |
|
|
|
13.6% |
|
Diluted EPS |
$0.29 - $0.43 |
|
|
|
$0.39 - $0.51 |
|
|
|
|
|
|
(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 $7 and $15 million for the fourth quarter 2024. Also
included in net income is income tax expense which we estimate will
be between $23 million and $35 million for the fourth quarter
2024.
|
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-IFRSNon-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-IFRSNon-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 Relationsir@gf.com
Global Foundries (NASDAQ:GFS)
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Global Foundries (NASDAQ:GFS)
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