Dive Brief:
- GlobalFoundries earned $1.6 billion in first-quarter 2026 revenue, down 11% from Q4 2025 and up 3.1% year over year.
- Results were driven by the manufacturing services sector as the company shipped about 579,000 300-millimeter-equivalent wafers in the quarter, up 7% from the prior-year period, CFO Sam Franklin said on an earnings call May 5.
- The results "demonstrate a strong step forward in our multiyear journey to enhance the quality of our revenue composition, improve our structural cost position and achieve efficient scale across our world-class fabs,” CEO and Director Timothy Breen said on the call.
Dive Insight:
The company’s quarterly results also show further progress in implementing GlobalFoundries’ “three-pillar strategy”, which includes developing innovative technologies, deepening engagement throughout customers' design cycles and scaling the company’s global footprint, Breen said.
Among other innovations, he cited the company’s advances in optical networking, including its silicon photonics and silicon germanium capabilities. According to Breen, the market is moving to adopt these technologies for “pluggable, near and co-packaged optics.”
“With process technology leadership, in-house design, assembly, test and packaging ecosystems, all supported with high-volume manufacturing in our advanced 300-millimeter fab footprint, including here in the U.S., we believe no other company has our suite of photonics offerings at our scale,” he said. Breen added that there are also opportunities for using silicon germanium solutions in artificial intelligence data centers.
He also said the company saw a 50% increase in “design wins” in Q1 year over year. For example, he noted the company’s multibillion-dollar chips partnership with Japan-based Renesas, which will broaden Renesas’ access to the foundry’s technologies, including its FDX FD-SOI, BCD and CMOS platforms with memory features.
The deal is part of a broader effort to strengthen U.S. semiconductor manufacturing while providing secure production options for Renesas, GlobalFoundries said in Frebruary.
Finally, Breen noted that the company has a diverse geographic footprint, manufacturing products in the United States, Germany and Singapore. Due to increasing geopolitical uncertainty, supply chain flexibility and resilience are paramount for many of GlobalFoundries’ customers and a strong differentiator in the company’s favor, he said.
Revenue from GlobalFoundries’ manufacturing services sector accounted for about 87% of total revenue for Q1, CFO Sam Franklin said on the call. Revenue from the technology services sector, which includes revenue from intellectual property, licensing, software, reticles, nonrecurring engineering, expedite fees and other items, accounted for about 13% of the total.
Technology services revenue was driven in part by “consistent momentum from within IP, licensing and software” as the company integrates last year’s acquisition of MIPS, Franklin said. MIPS is a leading supplier of AI and processor IP.
“As the momentum and engagements with customers grow, we expect MIPS to contribute a greater proportion of our technology services revenue going forward at an accretive gross margin to our corporate objectives,” Franklin said on the call.
Franklin noted that revenue from smart mobile devices, which represented 34% of total revenue during the quarter, declined 15% sequentially and 5% year over year.
Although the decline in this part of the company’s revenue stream was not a new development, he said he expects an eventual boost from the growth of smart glasses and other AI-enabled devices. He also said that “meaningful upside” from recent acquisitions is expected to help offset declining revenue in the smart mobile device segment in 2026.
Looking ahead, Franklin said the company expects total revenue of about $1.8 billion in Q2. “We are ramping R&D programs in the second half of 2026 to strengthen our technology differentiation and accelerate our road map in secular growth areas such as custom silicon, silicon photonics and advanced packaging,” he said.
