Nov 30 (Reuters) - GlobalFoundries forecast upbeat
current-quarter sales on Tuesday, in its first earnings update
after going public in October, banking on a spike in chip demand
as companies scramble to secure supplies amid a global
The Malta, New York-based company makes silicon wafers for
chip designers such as Advanced Micro Devices, Broadcom
Inc and Qualcomm Inc, which do not have their
own fabrication plants, called fabs.
Although the pandemic has fueled demand for laptops, mobile
phones and cars, it has also exacerbated a worldwide shortage of
semiconductor chips, forcing automakers and electronic firms to
curtail production and delay rollouts of new products.
The current shortage centers around less-advanced chips used
in making integrated circuits (ICs) and microcontrollers and
comes as foundries such as Taiwan Semiconductor Manufacturing Co
Ltd shift their focus on making higher-margin,
cutting-edge chips used in smart phones and laptops.
That, in turn, has helped GlobalFoundries, which is the
world's third-largest foundry by revenue, to stay competitive in
that segment of the market.
The company forecast fourth-quarter revenue of between $1.8
billion and $1.83 billion, the low end of which was in line
analyts' estimates, according to Refinitiv data.
GlobalFoundries posted revenue of $1.7 billion and a profit
of 7 cents per share for the third quarter ended Sept. 30, both
of which beat Wall Street's estimates.
Chief Executive Officer Tom Caulfield said higher wafer
output primarily drove revenue growth.
Still, the company's gross margins remained markedly low at
about 18% in the latest quarter, compared with foundry rivals
TSMC and Intel, whose gross margins came in well above 50%.
Shares of the company rose 1.4% in extended trading. They
have risen nearly 50% since going public, valuing the company at
more than $37 billion.
(Reporting by Eva Mathews in Bengaluru; Editing by Amy Caren
Daniel and Anil D'Silva)