GlobalFoundries Posts Record 31.4% Gross Margin
The chipmaker shifted capacity toward data center and automotive silicon as mobile demand softened.
Updated on Nov. 14, 2026 in Semiconductors
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GlobalFoundries reported record non-IFRS gross margins of 31.4% in its third-quarter 2026 earnings on November 4, 2026. The company shifted manufacturing capacity away from lower-margin mobile devices toward optical data center connectivity and custom automotive silicon.
Why it matters
More than two-thirds of the company's third-quarter revenue came from outside smart mobile devices, reducing exposure to smartphone market swings. Demand for silicon photonics continues to grow as artificial intelligence workloads scale, supporting the company's pivot for United States chip production.
GlobalFoundries reported a record 31.4% non-IFRS gross margin in the third quarter of 2026, with more than two-thirds of revenue coming from outside smart mobile devices. The filing does not give the prior-period margin for comparison, and the company's silicon photonics output targets remain projections.
The players
GlobalFoundries
A semiconductor manufacturer that produces chips on a contract basis for other companies, including automotive and data center customers.
The details
GlobalFoundries is funding expansion through customer prepayments and government grants rather than relying solely on its own capital. A partnership for its Malta, New York site uses fee structures and cost reimbursements to generate wafer profits without heavy upfront capital expenditures.
Timeline
November 4, 2026: GlobalFoundries reports third-quarter 2026 earnings and record gross margins.
2027: The company plans about $4 billion in net capital expenditures and expects a $1 billion annualized silicon photonics run rate by year's end.
2028: Expanded silicon photonics capacity is planned to support optical networking demand.
The Tech Race
GlobalFoundries is moving away from mobile chips toward silicon photonics, a technology used to move data inside AI data centers. The shift positions the company against larger foundry rivals competing for the same optical networking demand.
Chips for data centers and cars, rather than phones, are where this manufacturer is directing its capacity, which may shape the supply of components used in connected vehicles and cloud services. Consumers are unlikely to see direct price changes from this shift in the near term.
The takeaway
Companies in the chip industry are reducing reliance on any single end market by targeting areas with steady demand, such as data center connectivity. Investors and industry watchers can track whether silicon photonics output meets the 2027 targets outlined in the earnings report.
What happens next
GlobalFoundries plans to reach a $1 billion annualized silicon photonics revenue run rate by the end of 2027 and to approximately triple its silicon photonics capacity over the course of that year.
Further reading
For more on the chip industry's shift toward data center demand, explore Semiconductors.
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