GlobalFoundries Advancing Semiconductor Leadership in America - GLOBALFOUNDRIES INC

Explicit Guidance:

• 2027 Financial Impact: Revenue contribution from the new initiative expected at approximately $50 million; Gross margin accretion of 30–50 basis points; EPS accretion of 10–15 cents.
• Long-Term Financial Impact: Gross margin accretion to expand to 100–200 basis points; Operating margin accretion reaching 200–300 basis points; EPS accretion growing to $0.50–$0.75; Cumulative Free Cash Flow of approximately $3 billion over the next 10 years.
• Operating Margins: Accretion of 100–200 basis points expected in 2026, increasing further over time.
• Profit Per Wafer: Targeted to be comparable to internal capacity expansion over the next 10 years, achieved without incurring associated fixed costs.
• CHIPS Funding: Repurposing of $955 million (previously awarded) towards R&D and CapEx beginning in 2027.

Business-Segment Outlook:

• Capacity Expansion: Two new 300mm fabs at Malta, New York expected to add ~900,000 wafer equivalents each upon full operation, increasing total U.S. wafer capacity by ~10%.
• Technology Portfolio: Production to focus on FTX (edge/physical AI, automotive, industrial, data centers), BCD (power management, AI data center power), and UX (industrial/connected infrastructure), with potential for future technology additions based on market conditions.
• Job Creation: Anticipated creation of ~27,000 construction/ecosystem jobs and >1,000 high-skilled manufacturing jobs in New York's capital region.
• R&D & Advanced Packaging: Accelerated investments in silicon germanium, silicon photonics, and interposer technologies to support AI data center demand.

Market and Competitive Outlook:

• Demand Drivers: Strong, sustained demand driven by AI data center scaling and the proliferation of AI in the physical world (autonomous vehicles, intelligent factories, next-gen comms, robotics).
• Supply Dynamics: Significant gap in domestic supply for critical technologies; initiative addresses U.S. reliance on geographically concentrated overseas supply.
• Competitive Positioning: GF positioned as one of the only at-scale foundries with meaningful expansion capability on U.S. soil using differentiated technologies; selected for ability to execute large-scale construction and operational excellence.

Macro / Industry Outlook:

• Geopolitical Alignment: Initiative driven by U.S.-Japan Strategic Investments Agreement to reduce geographic concentration risks and ensure supply security for national defense and critical infrastructure.
• Regulatory Environment: Continued support from U.S. government (CHIPS Program Office) and local stakeholders (NY State, Saratoga County) creating a favorable ecosystem for semiconductor manufacturing onshoring.
• Government Equity: U.S. Department of Commerce taking an approximate 4% equity stake in GF; no further government equity participation expected.

Strategic Initiatives:

• Malta Phase 1: Shovel-ready; groundbreaking expected in the current quarter; construction complete for tooling ready by 2028; first wafers out expected in 2029.
• Malta Phase 2: Contingent on a "go-no-go" decision by stakeholders before the end of 2028; expected to mirror Phase 1 timeline.
• Financial Model Structure: Utilizes a Special Purpose Vehicle (SPV) owned by U.S./Japan governments to fully fund construction and tooling; GF provides management, construction, and technology services in exchange for fees and EBITDA share.
• Project Duration: Minimum 20-year term for the project.

Risks and Headwinds to Outlook:

• Deal Finalization: All financial metrics and figures are subject to the signing of definitive agreements.
• Execution Risk: Future results depend on successful completion of permitting, construction, and ramp of the two new fabs within the projected timelines.
• Stakeholder Decision: Phase 2 execution is conditional on a go-no-go decision between stakeholders before end-of-2028.
• Standard Caution: Actual results may differ materially from forward-looking statements due to various risk factors described in SEC filings (Form 20F, Form 6K) and the press release.

Management Tone on the Future:

• Confidence: High confidence in execution capabilities, citing proven track records in Malta (greenfield to high-volume) and Singapore (brownfield expansion ahead of schedule).
• Strategic Enthusiasm: Describes the announcement as "one of the most consequential" in company history and a "win-win" for U.S. and Japan objectives.
• Growth Trajectory: Outlook framed as "accretive" and "additive" to the long-term model, accelerating toward strategic goals without compromising existing capacity for demand upside.
• Commitment: "No obligation to update" forward-looking statements, but management expresses strong belief in the "extraordinary moment" and the "beginning" of driving customer momentum.

Miscellaneous:

• Revenue Recognition Timing: Technology fees commence in 2027 (minimum 20-year term); Operating fees begin when the first fab goes online (~2029); EBITDA sharing eligible from first production.
• Cost Structure: Expected to benefit from economies of scale and distributed operating costs from day one due to the Malta campus infrastructure.
• Customer Base: Existing relationships with Renesas, Tokyo Electron, Apple, Cirrus Logic, and General Motors; advanced discussions with additional customers seeking secure U.S. supply.