05 — Financials
Section role
This section is the dollars-and-cents view of GlobalFoundries. It reconciles every revenue, margin, capex, and balance-sheet number used elsewhere in the KB to a primary filing — Annual Report on Form 20-F (filed Feb–Mar each year), interim Form 6-K earnings releases (filed quarterly), Schedule 13D/13G beneficial-ownership filings, and the F-1 IPO prospectus (Oct 2021). The thesis section consumes everything here; the market-data section is the trading-side mirror.
Filing-regime context. GFS is a Cayman Islands exempted company / U.S.-listed foreign private issuer. Annual reporting is on Form 20-F (not 10-K), interim reporting on Form 6-K (not 10-Q). However, GFS voluntarily files Section 16 / Form 4 insider-transaction disclosures for its officers and directors — an unusual posture for an FPI and a meaningful contrast to POET (which is FPI-exempt and uses Form 144 instead). Mubadala’s 81.0% beneficial-ownership stake is reported on Schedule 13G via FMR’s filings; Mubadala itself is the Item 7 “Major Shareholder” on the 20-F.
Headline FY2025 numbers (per FY2025 20-F, filed 2026-02-27, acc. 0001709048-26-000022)
| Metric | FY2025 | FY2024 | FY2023 | YoY (FY24→FY25) |
|---|---|---|---|---|
| Net revenue | $6,791M | $6,750M | $7,392M | +1% |
| Gross profit (IFRS) | $1,690M | $1,651M | $2,101M | +2% |
| Gross margin | 24.9% | 24.5% | 28.4% | +40 bps |
| Operating profit (loss) | $797M | $(214)M | $1,129M | +$1,011M |
| Net income (loss) | $888M | $(262)M | $1,018M | +$1,150M |
| Diluted EPS | $1.59 | $(0.48) | $1.83 | +$2.07 |
| Non-IFRS adjusted EBITDA | $2,357M | (n/d) | (n/d) | — |
| Non-IFRS adjusted FCF | $1,157M | (n/d) | (n/d) | — |
| Cash + marketable securities (year-end) | $4.0B | $4.2B | n/a | −$200M |
| Total debt outstanding (year-end) | $1.2B | $1.8B | n/a | −$600M |
| Capex (PP&E + intangibles purchased) | $722M | $625M | $1,804M | +$97M |
| Cash from operating activities | $1,731M | $1,722M | $2,125M | +$9M |
| Diluted weighted-avg shares | 558M | 553M | 556M | +5M |
The FY25 P&L print is dominated by the FY24 base reset. FY24’s $(262)M GAAP net loss reflected a $935M long-lived-asset impairment charge taken in Q4 2024 against legacy production capacity at Malta, NY (per FY24 20-F & FY25 20-F Note disclosure). Stripping the impairment, FY25 vs. FY24 normalized operating profit was approximately +$77M ($797M FY25 vs. $721M ex-impairment FY24) — a more accurate read of underlying business momentum.
End-market mix (FY2025 20-F, “Revenue by End Markets”)
| End market | FY25 ($M) | FY25 % | FY24 ($M) | FY24 % | FY23 ($M) | FY23 % |
|---|---|---|---|---|---|---|
| Smart Mobile Devices | 2,678 | 39% | 3,048 | 45% | 3,023 | 41% |
| Automotive | 1,410 | 21% | 1,206 | 18% | 1,046 | 14% |
| Home & Industrial IoT | 1,189 | 18% | 1,267 | 19% | 1,604 | 22% |
| Communications, Infrastructure & Data Center | 745 | 11% | 577 | 9% | 863 | 12% |
| Non-Wafer Revenue | 769 | 11% | 652 | 10% | 856 | 11% |
| Total | 6,791 | 100% | 6,750 | 100% | 7,392 | 100% |
Note on “Personal Computing”: Earlier internal drafts assumed a separate Personal Computing segment. GFS does not report PC as a stand-alone end market. PC-adjacent revenue (consumer Wi-Fi, DSP, power management for laptops) is consolidated within Communications, Infrastructure & Data Center and Smart Mobile Devices. See segment mix for the detailed breakdown.
Q1 2026 guidance (issued 2026-02-11 with Q4’25 release)
| Metric | Midpoint guide | Implied YoY |
|---|---|---|
| Net revenue | $1,625M | +2.5% vs. Q1’25 ~$1,585M |
| IFRS gross margin | 26.0% | +210 bps |
| IFRS operating margin | 9.3% | +180 bps |
| IFRS diluted EPS | $0.23 | +$0.06 |
| Non-IFRS diluted EPS | $0.35 | +$0.06 |
| Fully diluted share count | 560M | flat |
Capital-allocation snapshot
- First buyback authorization in company history approved by Board February 2026 for up to $500M of ordinary shares, valid 12 months. No dividend program.
- CHIPS Act Direct Funding Agreement signed Nov 2024 for up to $1.5B + $75M January 2025 add-on for advanced packaging at Fab 8 = $1.575B total federal capacity to support Malta & Burlington VT. Fab 8 milestone-based; first two milestones funded in 2025.
- State of New York Agreement for $570M layered on top of the federal grant for Fab 8 expansion.
- OBBBA (One Big Beautiful Bill Act, July 2025) raised the AMITC investment tax credit from 25% → 35% beginning tax year 2026 — a meaningful tax-shield uplift on capex.
- 5 acquisitions closed in 2025: SMP (Jan 2), MIPS (Aug 13), AMF Singapore (Nov 14), InfiniLink (Nov 14), Tagore Technology (date TBD per 20-F subsidiaries list). Total acquisition cash outflow: $682M in FY25 (cash flow statement).
- Buybacks per FY25 cash flow: $845M cash used in financing; mix of debt repayment (term loan $586M paid down) + share repurchases under prior program (the Feb 2026 authorization is the first formal multi-year buyback but tax-withholding RSU repurchases occurred earlier).
Material weakness in internal control over financial reporting (ICFR)
Flagged in FY25 20-F: “For the fiscal years ended December 31, 2023, 2024 and 2025, our management identified material weaknesses in our ICFR… management concluded that our ICFR was not effective as of December 31, 2025.”
This is three consecutive fiscal years with material-weakness conclusions. Remediation plans are described in Item 15 of the 20-F. This is a notable risk-disclosure item and is referenced in ../07_thesis/ bear-thesis context.
What’s here
- segment mix — End-market revenue split (Smart Mobile, Automotive, Home/IIoT, Comm/Infra/DC, Non-Wafer); FY trends; quarterly cadence where disclosed.
- quarterly trend — Last 8 quarters of revenue, GM, OI, FCF, capex from 6-K earnings releases.
- balance sheet — Cash + marketable securities, debt stack (term loans + Singapore EDB loan + EUR/USD facilities), $1.0B undrawn revolver, PP&E carrying value, goodwill from 5 acquisitions.
- capex cycle — 5-year capex history by fab; CHIPS Act $1.575B + NY $570M offset; AMITC enhanced from 25% → 35%.
- margins and pricing — Gross margin trajectory FY23→FY25; ASP / utilization / mix-shift drivers; non-IFRS bridge.
- capital returns — Feb 2026 $500M buyback authorization; no dividend; Mubadala selldown trajectory (none material — still 81%); SBC as % of revenue.
- comps valuation — Specialty foundry comp set: TSMC, UMC, Samsung Foundry (segment), SMIC, Vanguard Intl Semi, Tower (pre-Intel), X-FAB; EV/Sales, EV/EBITDA, P/E.
- dcf assumptions — Load-bearing DCF inputs: WACC, terminal growth, capex/sales, segment growth, AMITC tax shield.
- mubadala related party — Shareholder’s Agreement, secondment, related-party transactions, lock-up implications.
- financials summary — Analyst executive summary (will host the FinancialsSnapshotGFS SVG component).
Reading order
- For a 20-minute read: quarterly trend → segment mix → margins and pricing. You will know where the FY25 print landed and why.
- For balance-sheet / capital-structure work: balance sheet → capex cycle → mubadala related party.
- For valuation / thesis support: comps valuation → dcf assumptions →
../07_thesis/.
Discipline reminder
Every revenue, margin, or capex number in this section reconciles to a 20-F line item or 6-K earnings release. Quarterly figures cite the 6-K accession. Acquisition-related figures cite the 20-F subsidiaries list and the cash-flow statement. Mubadala 81.0% stake is anchored to Item 7 of the FY2025 20-F (450,387,613 shares of 555,756,300 outstanding as of 2025-12-31). The material-weakness disclosure is preserved verbatim from Item 15 — do not soft-pedal it.
Cross-section pointers
- overview — corporate history, IPO, Mubadala spinout from AMD.
- overview — top-3 customer concentration (16.4% / 13.9% / <10% of wafer revenue per FY25 Note 32).
- overview — trading-side mirror; insider Form 4 ledger; Mubadala Schedule 13G context.
- overview — load-bearing valuation work consumes comps valuation + dcf assumptions.
- overview — primary-source catalog (20-F, 6-K, 13G filings).