My biggest worry with GF going forward is it’s ability to scale. In absence of cutting edge node and volume, GF will continue to be in this cost cutting loop again and again and again due to motivation for CEO to artificially make the balance sheet look good for stock prices to be attractive. I do not see end to this pain for this bottom feeder foundry until it is acquired by one of big ones.
10 replies (most recent on top)
Meanwhile, Yahoo is telling the world that GF is poised to surge.
https://finance.yahoo.com/news/why-globalfoundries-inc-gfs-might-172005620.html
You srsly think the previous leaders before PB's crew were better?
It's a talent desert in Malta!
Business challenge is definitely going to stay with GF after 7 nm pivot. Major issue that is hurting the company is rampant corruption, racism and favoritism. With AME take over by lady from Singapore, things are so dark and gloomy as she prefers people who are yes mam to her. This has created crowd of highly incompetent and failed managers and directors who are now there to support her position in AME. Not sure why PB not able to see this. Whole AME is in deep leadership chaos and am afraid some good remaining ones particularly IBM leaders will soon leave GF as soon as this CEO is fired. This AME VP should be immediately fired to save the GF and every day is delay and harmful. God save GF
Bottom line - Get out of this place before this ship sinks!!
Problem is that GF revenue is based on mature 14nm mobile, communication and data center chips which are not growing enough to give lucrative gross margin. This continues to limit the long term growth for this bottom feeder company which continues to be in danger of strong competition and price pressure from UMC and SMIC soon.
Intel’s IFS kick off will be last nail to coffin as soon as it is ready in 2H 23 as reported.
Another issue is that most of the top tier foundries and OEMs are relying on cutting edge 7nm and 5nm technology to improve their gross margin and opex. GF has nothing of that sort. Simply relying on Automotive to show growth which is not even 400mn in Q4 is too little too small.
See statement from TSMC below :
Our third quarter business was supported by strong demand for our industry-leading 5nm technologies," said Wendell Huang, VP and chief financial officer of TSMC during the third-quarter 2022 earnings conference call. "Moving into the fourth quarter 2022, we expect our business to be flattish, as the end market demand weakens, and customers' ongoing inventory adjustment is balanced by continued ramp-up for our industry-leading 5nm technologies."
"Deutsche Bank analyst Ross Seymore said chipmakers with the largest existing fabrication plants, or fabs, in the U.S. such as Intel, Texas Instruments and GlobalFoundries will benefit most from the CHIPS Act." 🤔
Something's missing here. Where's the guy with the WARN Act?
Correct. That is the literal playbook GF is going by. GF slapped a huge expiration date on itself with 7nm pivot. And as time goes on its value will diminish. Like a stock option.
Best advice get out as soon as you can.
Exactly... there's no viable long term strategy. A lot of short term decisions being made, not even considering Friday's announcement. Everyone should keep this in mind