Due to the sharp focus on wafer capacity for end-market applications, GlobalFoundries experienced a large increase in earnings for the second quarter of 2022. According to the recently published report, the company’s net income increased by 23% year-on-year to reach $1.99 billion. The factors leading to such an increase are the high average selling price (ASP) and escalated wafer supplies.

Segment-by-segment details are illustrated above, showing consistent revenue growth for five consecutive quarters. Although revenue from smart mobile devices fell slightly, it remains the highest-grossing segment for GlobalFoundries.

Due to factors such as better absorption of fixed costs, higher ASP and improved mix, adjusted gross margin saw a 12% year-over-year increase to 28%.

Given the delays in the supply of wafer manufacturing equipment, the report estimates that total gross capital expenditures for this year will fall short of $4 billion. In the first half of 2022, 65% of total wafer shipments and 90% of design wins are single-sourced. Additionally, single-source revenue in the first half of 2022 grew 37% year-over-year, making it the sector with the highest revenue.

It is interesting to note that in 2022 alone, the company has secured nearly US$6 billion in incremental new LTAs with customers, all of which are single-source businesses.
For 2022, the company hopes for wafer shipments of about 2.6 million. And for the third quarter of 2022, the goal is to achieve 20% annualized revenue, reaching $2.035 billion – $2.065 billion.

GlobalFoundries will increase its market share and margins by entering new geographies and attracting a broader customer base.

Sound Earnings in Q2 2022: GlobalFoundries

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