GlobalFoundries Inc, the biggest US-based provider of made-to-order semiconductors, gave a bullish forecast for the current quarter, indicating the rush to get chips continues amid industry-wide shortages.
Sales would be US$1.88 billion to US$1.92 billion in the period ending next month, the Malta, New York-based company said in a statement on Tuesday.
Profit, excluding certain items, would be US$0.21 to US$0.27 a share. Those predictions compare with analysts’ average estimates of US$1.84 billion and US$0.14 a share.
Photo: Reuters
GlobalFoundries, majority owned by the government of Abu Dhabi, began life as a publicly traded company in October last year. The chipmaker, which is a fraction of the size of market leader Taiwan Semiconductor Manufacturing Co (台積電), is trying to carve out a larger slice of the market for outsourced semiconductor production.
Chief executive officer Tom Caulfield and his counterparts at other chipmakers are trying to convert the demand spike into long-term commitments from customers with the aim of stabilizing their growth and profitability.
They also hope to increase capacity by using proposed government incentives to build facilities in the US and Europe.
Investors should have confidence that the industry is going to avoid past cycles of boom followed by gluts if sales double as projected to US$1 trillion in 10 years, Caulfield said in an interview.
Current plans for factory expansion still would not keep up with that pace of growth, he said.
Furthermore, GlobalFoundries is only adding capacity when it gets financial commitments from customers who are seeking guaranteed supply.
Chipmakers are no longer building plants based on forecasts hoping orders will show up, he said.
GlobalFoundries shares have increased 19 percent to US$56.05 since October last year, when a slice of the company began trading on the public markets, beating overall gains by chip stocks. They rose about 3.5 percent in extended trading following the report.
Fourth-quarter revenue jumped 74 percent to US$1.85 billion. Profit was US$0.18 a share, excluding certain items.
Analysts, on average, projected US$1.81 billion and US$0.09, data compiled by Bloomberg showed.
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