GLOBALFOUNDRIES Inc.

GlobalFoundries reported first-quarter 2026 revenue of $1.634 billion, down 11% sequentially and up 3.1% year over year. Gross profit was $474 million, gross margin was approximately 29%, up 510 basis points year over year, operating profit was $271 million, operating margin was 16.6%, and diluted EPS was $0.40. Cash flow from operations was $542 million, capex net of government grants was $309 million, adjusted free cash flow was $233 million, and adjusted free cash flow margin was approximately 14%. For Q2 2026, management guided revenue to $1.76 billion plus or minus $25 million, gross margin to approximately 28.5% plus or minus 100 basis points, operating margin to 15.7% plus or minus 180 basis points, and diluted EPS to $0.43 plus or minus $0.05. Full-year 2026 guidance included net capex of 15% to 20% of revenue, adjusted free cash flow margin of approximately 10%, and an effective tax rate in the high teens; management also said gross margin should exit 2026 at or above 30%.

Tim Breen framed the quarter as evidence that GF’s multiyear strategy is working, citing stronger revenue quality, better cost structure, and efficient scale across its fabs. He emphasized three pillars: differentiated technology, deeper customer engagement, and a diversified manufacturing footprint that supports onshoring and supply-chain resilience. His tone was notably confident around optical networking, SiGe, automotive MRAM, and customer wins tied to AI, data center, and onshoring.

Sam Franklin highlighted that revenue, gross margin, and operating margin all landed at or above the high end of guidance. He said Q1 gross margin was a record for the quarter and expanded more than 500 basis points year over year, helped by richer mix, technology services, and about 1 point of margin benefit from Advanced Micro Foundry synergies. He also detailed liquidity and capital returns: cash and marketable securities were about $3.8 billion, debt was $1.1 billion, the revolver was undrawn, and GF repurchased $400 million of stock under a $500 million authorization, leaving about $100 million remaining.

Analysts focused on pricing, gross margin sustainability, and whether GF is gaining share in comms/data center. Management said pricing is stable in parts of the portfolio with long-term agreements, but more favorable in shorter-cycle areas, where price adjustments should begin toward the back half of 2026 and flow into 2027. On margins, Sam said the Q1 beat came from mix, tech services, and AMF synergies, and he added that supply-chain security actions tied to the Middle East conflict could trim about 0.5 points of margin per quarter for the rest of 2026. Management also said CID growth is being driven by silicon photonics and high-performance SiGe, with share gains in many submarkets and full-year CID growth now expected in the high 30s percent range.