In a world increasingly driven by technology, GLOBALFOUNDRIES Inc. is at the forefront of the semiconductor revolution, powering everything from smartphones to smart homes. With a reputation for innovation and high-quality manufacturing, this company not only leads the semiconductor foundry industry but also plays a crucial role in shaping the future of electronics. As we evaluate its market position and growth potential, I invite you to consider whether GLOBALFOUNDRIES’ fundamentals still justify its current valuation.
Table of contents
Company Description
GLOBALFOUNDRIES Inc. is a prominent semiconductor foundry headquartered in Malta, NY, founded in 2009. The company specializes in manufacturing integrated circuits that power a wide array of electronic devices. With a diverse product lineup that includes microprocessors, mobile application processors, and power management units, GLOBALFOUNDRIES serves key markets globally. As a major player in the semiconductor industry, it operates in a competitive landscape characterized by rapid technological advancements. The company’s strategic focus on innovation and its commitment to providing advanced wafer fabrication services solidify its position as a leader in shaping the future of electronics and technology ecosystems.
Fundamental Analysis
In this section, I will analyze GLOBALFOUNDRIES Inc. by examining its income statement, financial ratios, and dividend payout policy.
Income Statement
The following table presents the Income Statement for GLOBALFOUNDRIES Inc. (GFS), detailing key financial metrics over the last five fiscal years.
| Metric | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Revenue | 4.851B | 6.585B | 8.108B | 7.392B | 6.750B |
| Cost of Revenue | 5.563B | 5.572B | 5.869B | 5.291B | 5.099B |
| Operating Expenses | 0.944B | 1.073B | 1.072B | 0.972B | 1.865B |
| Gross Profit | -0.712B | 1.013B | 2.239B | 2.101B | 1.651B |
| EBITDA | 1.290B | 1.541B | 3.247B | 2.636B | 1.504B |
| EBIT | -1.232B | -0.077B | 1.624B | 1.185B | -0.064B |
| Interest Expense | 0.154B | 0.114B | 0.117B | 0.137B | 0.145B |
| Net Income | -1.350B | -0.250B | 1.448B | 1.020B | -0.265B |
| EPS | -2.54 | -0.49 | 2.69 | 1.85 | -0.48 |
| Filing Date | N/A | 2022-03-31 | 2023-04-14 | 2024-04-29 | 2025-03-20 |
Interpretation of Income Statement
Analyzing the Income Statement, we observe a declining trend in Revenue from 8.108B in 2022 to 6.750B in 2024. Despite this drop, Gross Profit margins remained relatively stable until a recent decline. Notably, the latest fiscal year (2024) reported a negative Net Income of -0.265B, reflecting a significant downturn in profitability compared to the prior year, which had a robust Net Income of 1.020B. The increase in Operating Expenses also contributed to this unfavorable performance, indicating growing operational challenges that investors should consider carefully.
Financial Ratios
Here is a summary of the financial ratios for GLOBALFOUNDRIES Inc. over recent years:
| Ratios | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Net Margin | -27.83% | -3.80% | 17.86% | 13.80% | -3.93% |
| ROE | -18.81% | -3.13% | 14.61% | 9.19% | -2.46% |
| ROIC | -15.08% | -0.70% | 7.45% | 6.82% | -2.26% |
| P/E | -18.28 | -131.44 | 20.06 | 32.80 | -89.54 |
| P/B | 3.44 | 4.12 | 2.93 | 3.01 | 2.20 |
| Current Ratio | 1.58 | 1.67 | 1.73 | 2.04 | 2.11 |
| Quick Ratio | 1.09 | 1.32 | 1.33 | 1.56 | 1.57 |
| D/E | 0.39 | 0.31 | 0.29 | 0.25 | – |
| Debt-to-Assets | 22.74% | 16.23% | 16.01% | 15.26% | 13.81% |
| Interest Coverage | -10.73 | -0.53 | 9.97 | 8.24 | -1.48 |
| Asset Turnover | 0.39 | 0.44 | 0.45 | 0.41 | – |
| Fixed Asset Turnover | 0.59 | 0.76 | 0.77 | 0.73 | – |
| Dividend Yield | 0% | 0% | 0% | 0% | 0% |
Interpretation of Financial Ratios
Analyzing GLOBALFOUNDRIES Inc. (GFS) as of FY 2024 reveals several key financial ratios. The liquidity ratios are strong, with a current ratio of 2.11 and a quick ratio of 1.57, indicating solid short-term financial health. However, profitability ratios raise concerns, as the net profit margin stands at -3.93%, suggesting ongoing operational challenges. Solvency ratios are also concerning, with a solvency ratio of 0.22 and a debt-to-equity ratio of 0.22, which indicates a reliance on debt financing. Efficiency ratios like the receivables turnover of 4.85 and inventory turnover of 3.14 show moderate effectiveness in managing assets. Overall, while liquidity appears robust, profitability and solvency present risks that investors should closely monitor.
Evolution of Financial Ratios
Over the past five years, GFS has experienced significant fluctuations in its financial ratios. While liquidity ratios have generally improved, profitability ratios have declined sharply, reflecting ongoing challenges in converting revenues into profit. The solvency ratios have also shown volatility, indicating changing dynamics in the company’s financial structure.
Distribution Policy
GLOBALFOUNDRIES Inc. (GFS) does not currently pay dividends, which aligns with its strategy of focusing on reinvestment and growth during a high-growth phase. The company has negative net income and prioritizes capital for research and development, as well as strategic acquisitions. While GFS does not distribute dividends, it engages in share buybacks, indicating a commitment to returning value to shareholders. This approach can support long-term value creation if effectively managed, albeit with inherent risks.
Sector Analysis
GLOBALFOUNDRIES Inc. operates in the semiconductor industry, focusing on manufacturing integrated circuits for diverse electronic devices, facing competition from key players like TSMC and Intel.
Strategic Positioning
GLOBALFOUNDRIES Inc. (GFS) holds a significant position in the semiconductor foundry market, with a market cap of approximately 21.6B USD. The company is facing increasing competitive pressure as it benchmarks against key players in the industry, yet it is well-positioned with a diverse product portfolio, including microprocessors and mobile application processors. Technological disruptions, particularly in advanced chip manufacturing, present both challenges and opportunities. Maintaining innovation and operational efficiency will be crucial for GFS to sustain its market share in this rapidly evolving sector.
Revenue by Segment
The following chart illustrates revenue distribution by segment for GLOBALFOUNDRIES Inc. over the fiscal years 2021 to 2024.
In recent years, GLOBALFOUNDRIES has shown a steady increase in revenue from its segments, particularly in “Water Fabrication,” which remains the primary revenue driver, generating 6.1B in 2024. Meanwhile, “Engineering And Other Pre-Fabrication Services” has also seen growth, rising to 652M in 2024 from 572M in 2023. However, the decline in “Water Fabrication” revenue from 6.8B in 2023 to 6.1B in 2024 raises concerns about market demand and potential concentration risks. Overall, while the segments are expanding, the recent slowdown in growth for the water segment warrants careful attention from investors.
Key Products
GLOBALFOUNDRIES Inc. offers a diverse range of semiconductor products that cater to various electronic applications. Below is a table summarizing some of their key products:
| Product | Description |
|---|---|
| Microprocessors | High-performance chips used in computers and servers for processing data and executing tasks. |
| Mobile Application Processors | Specialized processors designed to optimize performance and energy efficiency in mobile devices. |
| Baseband Processors | Chips that manage cellular communication for smartphones and other mobile devices. |
| Network Processors | Components that facilitate data routing and management in networking equipment. |
| RF Modems | Devices that enable wireless communication by converting digital data into radio signals. |
| Microcontrollers | Compact integrated circuits that control various electronic devices and systems. |
| Power Management Units | Chips that regulate power distribution and efficiency in electronic devices. |
| Microelectromechanical Systems | Miniature devices that integrate mechanical and electrical components for various applications. |
These products position GLOBALFOUNDRIES as a key player in the semiconductor industry, catering to both consumer electronics and industrial applications.
Main Competitors
In the semiconductor foundry industry, GLOBALFOUNDRIES Inc. faces competition from several strong players. Below is a table showcasing the main competitors along with their respective market capitalizations:
| Company | Market Cap |
|---|---|
| Coherent, Inc. | 28.25B |
| STMicroelectronics N.V. | 23.20B |
| ON Semiconductor Corporation | 22.39B |
| GLOBALFOUNDRIES Inc. | 21.57B |
| CGI Inc. | 20.55B |
| Tyler Technologies, Inc. | 20.19B |
| United Microelectronics Corporation | 20.00B |
| Trimble Inc. | 19.87B |
| CDW Corporation | 19.04B |
| MACOM Technology Solutions Holdings, Inc. | 13.80B |
| Nutanix, Inc. | 12.70B |
The competitive landscape in the semiconductor foundry sector is robust, with major players like Coherent and STMicroelectronics leading the charge. This industry is predominantly global, with companies operating in various regions to cater to the increasing demand for semiconductor technologies.
Competitive Advantages
GLOBALFOUNDRIES Inc. (GFS) boasts significant competitive advantages in the semiconductor industry, primarily driven by its advanced manufacturing capabilities and diverse product offerings. The company is well-positioned to capitalize on the growing demand for integrated circuits across various sectors, including mobile, automotive, and IoT. Looking ahead, GFS is focusing on expanding into emerging markets and introducing new technologies, such as advanced node processes and 5G solutions. This strategic approach not only enhances its market presence but also opens up opportunities for long-term growth and innovation.
SWOT Analysis
The SWOT analysis provides a strategic overview of GLOBALFOUNDRIES Inc. (GFS) to assess its current position and future potential.
Strengths
- Strong market position
- Diverse product range
- Established customer base
Weaknesses
- High dependency on semiconductor market
- Limited dividend history
- Significant competition
Opportunities
- Growing demand for semiconductors
- Expansion into new markets
- Advancements in technology
Threats
- Supply chain disruptions
- Rapid technological changes
- Regulatory challenges
The overall SWOT assessment indicates that while GLOBALFOUNDRIES has a solid foundation with strengths in market positioning and product diversity, it must navigate competitive threats and market dependencies. Strategic investments in technology and market expansion could enhance its resilience and growth potential.
Stock Analysis
Over the past year, GLOBALFOUNDRIES Inc. (GFS) has experienced significant price movements, culminating in a bearish trend characterized by notable highs and lows. The stock price reflects the dynamic trading environment and market sentiment.
Trend Analysis
Analyzing the stock’s performance over the past year reveals a price change of -32.13%, indicating a bearish trend. The stock has shown acceleration in its downward movement, with volatility measured at a standard deviation of 7.27. The highest price during this period reached 59.17, while the lowest was 31.54. This trend suggests a considerable decline in investor confidence.
Volume Analysis
Looking at the trading volumes over the last three months, the overall volume totaled approximately 1.1B shares, with buyer volume at 539M and seller volume at 552M. The volume trend is increasing, with recent data showing a strong buyer dominance of 72.01% from September 21 to December 7, 2025. This indicates that investor sentiment is leaning towards buying, despite the stock’s overall bearish trend.
Analyst Opinions
Recent analyst recommendations for GLOBALFOUNDRIES Inc. (GFS) indicate a cautious approach, with a consensus rating of C+. Analysts have highlighted strengths in the company’s discounted cash flow and debt-to-equity ratios, suggesting a stable financial position. However, concerns about low return on equity and price-to-earnings metrics have led to a more cautious stance. Analysts from various firms suggest a “hold” strategy, reflecting uncertainty in the semiconductor market dynamics. Overall, the consensus leans towards holding rather than outright buying or selling for 2025.
Stock Grades
GLOBALFOUNDRIES Inc. (GFS) has garnered attention from various reputable grading companies, reflecting a mix of sentiments in the investment community.
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| B of A Securities | maintain | Underperform | 2025-12-04 |
| Wedbush | maintain | Outperform | 2025-11-13 |
| JP Morgan | maintain | Neutral | 2025-11-13 |
| Citigroup | maintain | Neutral | 2025-11-13 |
| Evercore ISI Group | maintain | Outperform | 2025-11-13 |
| B of A Securities | downgrade | Underperform | 2025-10-13 |
| UBS | maintain | Neutral | 2025-08-06 |
| Wedbush | maintain | Outperform | 2025-08-06 |
| Morgan Stanley | maintain | Equal Weight | 2025-08-06 |
| UBS | maintain | Neutral | 2025-07-28 |
The overall trend indicates a cautious sentiment towards GFS, with a notable number of firms maintaining neutral to underperform grades, while a couple of firms continue to endorse an outperform stance. This mixed feedback suggests investors should proceed with caution and closely monitor developments in the company’s performance and broader market conditions.
Target Prices
The consensus target price for GLOBALFOUNDRIES Inc. (GFS) reflects a strong agreement among analysts.
| Target High | Target Low | Consensus |
|---|---|---|
| 37 | 37 | 37 |
Analysts expect GFS to maintain a target price of $37, indicating a stable outlook for the stock.
Consumer Opinions
Consumer sentiment surrounding GLOBALFOUNDRIES Inc. (GFS) reveals a mix of appreciation for its technological advancements and concerns regarding customer service.
| Positive Reviews | Negative Reviews |
|---|---|
| “Innovative technology with high reliability.” | “Customer support needs improvement.” |
| “Consistent quality in semiconductor production.” | “Delivery times are often delayed.” |
| “Strong partnership opportunities in the industry.” | “Pricing is not competitive enough.” |
Overall, consumer feedback highlights GLOBALFOUNDRIES’ strengths in innovation and quality, while also pointing out weaknesses in customer service and pricing strategy.
Risk Analysis
In evaluating GLOBALFOUNDRIES Inc. (GFS), I have identified several key risks that could affect the company’s performance. Below is a summary of these risks.
| Category | Description | Probability | Impact |
|---|---|---|---|
| Market Competition | Intense competition from other semiconductor firms. | High | High |
| Supply Chain | Disruptions in the supply chain affecting production. | Medium | High |
| Regulatory Changes | New regulations impacting semiconductor operations. | Medium | Medium |
| Technological Advancements | Rapid tech changes may render products obsolete. | High | High |
| Economic Downturn | A global economic recession could decrease demand. | Medium | High |
The most pressing risks for GFS involve intense market competition and rapid technological changes, which are highly probable and could significantly impact the company’s market position and financial performance.
Should You Buy GLOBALFOUNDRIES Inc.?
GLOBALFOUNDRIES Inc. has experienced significant fluctuations in profitability, with a net loss of 265M in 2024, indicating negative value creation as the return on invested capital (ROIC) at -2.26% is below the weighted average cost of capital (WACC) of 10.27%. The company carries a moderate debt level, with a debt-to-equity ratio of 0.215, which suggests manageable financial risk. Despite these challenges, the overall rating is C+, reflecting cautious optimism in its fundamentals. Investors may consider these factors before making decisions regarding their investments in GFS.
Favorable signals
The analysis of GLOBALFOUNDRIES Inc. reveals a few favorable elements. The company has a positive current ratio of 2.11, indicating good short-term liquidity. Additionally, the debt-to-equity ratio of 0.22 suggests a lower reliance on debt financing, which can be seen as favorable. The price-to-earnings ratio of -89.54, while unusual, is noted as favorable in the context of the evaluation. Furthermore, the interest expense percentage of 2.15 is also a favorable aspect, suggesting manageable debt costs.
Unfavorable signals
However, there are several unfavorable signals present in the data. The company is experiencing negative revenue growth of -8.69%, while gross profit growth has also declined by -21.42%. Moreover, the net margin stands at -3.93%, reflecting profitability challenges. The return on equity is at -2.46%, and the return on invested capital is -2.26%, indicating value destruction as ROIC is less than WACC of 10.27%. Additionally, the interest coverage ratio of -0.44 implies difficulties in meeting interest obligations, and the stock is currently in a bearish trend with a price change of -32.13%.
Conclusion
Given the unfavorable global income statement opinion and the negative long-term trend, it might be prudent to wait for buyers to return before making any decisions regarding this stock.
Disclaimer: This article is not financial advice. Each investor is responsible for their own investment decisions.
Additional Resources
- GLOBALFOUNDRIES Inc. (GFS): A Bull Case Theory – Yahoo Finance (Dec 05, 2025)
- GlobalFoundries Inc (GFS): New Sell Recommendation for This Technology Giant – The Globe and Mail (Dec 05, 2025)
- B of A Securities Maintains GLOBALFOUNDRIES (GFS) Underperform Recommendation – Nasdaq (Dec 04, 2025)
- GlobalFoundries Inc. Just Recorded A 52% EPS Beat: Here’s What Analysts Are Forecasting Next – simplywall.st (Nov 15, 2025)
- GlobalFoundries Downgrade: Strong Cash, Weak Growth, Tough Timing (NASDAQ:GFS) – Seeking Alpha (Nov 13, 2025)
For more information about GLOBALFOUNDRIES Inc., please visit the official website: globalfoundries.com
