Although Globalfoundries covers many production lines with LTA (long-term contracts), jobs are being cut in addition to a hiring freeze to prepare for the uncertainty in the market. However, the latest figures and forecasts were still very positive.
Layoffs are back in the plans of many manufacturers for the future, in order to get fit for the future after the boom of the last two years and the subsequent downturn in the market. Globalfoundries said in last week's quarterly report that it would cut spending by $200 million a year, and over the weekend it was said that this would include layoffs.
It is not yet known how many people will ultimately lose their jobs in the foundry. A spokeswoman for Globalfoundries did not want to explain to Bloomberg which areas are primarily affected, while she confirmed the basic downsizing.
Globalfoundries benefited from the corona crisis
Globalfoundries was lucky due to the extremely high demand in times of the corona crisis, because the manufacturer was able to use this time to recover from its rather poor position. The time was even used for the IPO, with many billions of debts in the luggage, big plans for the future including factory expansions were made, also thanks to the US Chips Act and many subsidies.
It also worked very well recently, the third quarter of this year was once again closed with a sales increase of 22 percent compared to the previous year, and at the same time only five percent increased wafer quantity. Above all, the margin improved massively, instead of a profit of five million US dollars a year ago, there are now 336 million US dollars net in the books.
While the PC division Globalfoundries is gradually retiring completely as expected, the automotive business as a selected future market was surprisingly weak. In return, the IoT business grew very rapidly.
