GlobalFoundries Data Center Revenue Up 80.6% to $316 Million in Q3

GlobalFoundries grew Communications Infrastructure & Data Center revenue 80.6% to $316 million in the third quarter, according to its Form 6-K quarterly report filed on 4 November. Smart Mobile Devices revenue fell 18.8% to $611 million over the same period. Each segment moved by exactly $141 million.

The symmetry is the story. The data center gain matched the phone decline dollar for dollar. Data center rose to 16.6% of total revenue, up from 10.4%. Phones fell to 32.2%, down from 44.5%. The company's filings do not name the customers behind either shift, and they do not describe one as replacing the other. That claim, repeated across coverage, is arithmetic, not disclosure.

Where the growth actually came from

Total revenue reached $1.899 billion, up 12.5%. The company attributed the rise to a 7.5% increase in wafer shipment volumes to 647,000 300mm-equivalent wafers, a 4.8% increase in average selling prices driven by favorable product mix, and higher Technology Services revenue.

The report ties the data center growth specifically to "data center networking applications utilizing SiPh and SiGe technologies" — silicon photonics and silicon germanium. The phone decline reflects "memory price-driven demand weakness in the smartphone market," the filing states.

Chief executive Tim Breen said the quarter delivered "record non-IFRS gross margin reflecting a richer mix of business across high-value, high-growth AI applications."

The margin numbers support his claim. Non-IFRS gross margin reached 31.4%, against 26.0% a year earlier. Non-IFRS gross profit rose $158 million on $211 million of added revenue. That means 74.9 cents of every incremental revenue dollar became gross profit. Caveat: non-IFRS excludes the share charge discussed below, and the IFRS picture is considerably worse.

Home and Industrial IoT revenue grew 48.8%. Automotive grew 20.3%. Every segment except phones expanded.

Why the quarter shows a $270 million loss

The company reported an IFRS net loss of $270 million alongside non-IFRS net income of $298 million. The gap comes from a single accounting item. GlobalFoundries issued 9.9 million ordinary shares to the U.S. government, triggering a $441 million non-cash charge in non-operating expense.

The filing values the shares at the closing price of $44.53 on September 3, 2026. The charge is the primary driver of the IFRS loss. Fourth-quarter guidance excludes "expected non-cash charges in non-operating expense for additional common share issuances to the USG," because their timing and amount remain uncertain. More charges are possible; the company says so itself.

What does the fourth quarter and the TSMC deal change?

GlobalFoundries guides fourth-quarter revenue of $2,000 million, plus or minus $25 million — 5.3% above the third quarter at the midpoint. It guides non-IFRS gross margin of 31.5%, plus or minus 100 basis points.

The quarter closed before two consequential October announcements. GlobalFoundries agreed a multi-year, $2 billion manufacturing agreement with TSMC to establish a U.S.-based supply of silicon interposers for TSMC's CoWoS advanced packaging ecosystem. Volume production is expected to begin ramping in the first half of 2028. That date is a company roadmap, not a confirmed ramp.

The company was also selected to operate two new fabs in Malta, New York, under a U.S.-Japan initiative providing up to $21 billion in funding, and it agreed to reallocate $955 million of CHIPS Act incentives.

Against consensus estimates cited by Wall St Engine, revenue of $1.90 billion beat the expected $1.89 billion. Adjusted EPS of $0.53 beat the $0.50 consensus. Adjusted gross margin of 31.4% beat the 30.4% estimate. Wall St Engine cites a 30.7% estimate for fourth-quarter adjusted gross margin, against guidance of 31.5%.

What is not established

The filings do not split the data center segment between data center and communications infrastructure. The 80.6% figure covers both. The two $141 million movements are reported as separate line items; no causal link between them appears in the disclosure. Guidance figures are the company's outlook, not commitments. The quarterly report carries no risk-factor section of its own and refers readers to the 2025 Annual Report on Form 20-F.

The structural read is straightforward. Growth and margin came from data center networking and other non-phone markets. Phones, still the largest end market, shrank. A $2 billion interposer deal and up to $21 billion in fab funding now sit behind that mix shift, with volume production not expected until 2028.