GlobalFoundries, the AMD spin-off that went public in 2021 and produces sufficient chips to make it the world’s fourth-largest semiconductor producer, has introduced it would enact a hiring freeze and start job cuts. The information, which got here in an earnings name final week reported by Bloomberg (opens in new tab), is a part of a drive to decrease the corporate’s working bills by $200 million yearly.
In an earnings announcement earlier this month, the agency, valued at $25 billion after its October 2021 floatation, reported better-than-expected outcomes (opens in new tab), hitting a brand new document for income with a $2.1 billion determine, up 22% yr on yr. Nevertheless, it additionally stated it noticed a slowing in chip demand for 2023 and anticipated little or no development within the present quarter. In keeping with its CFO Dave Reeder, the corporate was trying to comprise prices and convey up deliberate ‘initiatives’ that might ship the $200 million annual financial savings, however the bulk of it will come from cuts to bills.
GlobalFoundries, which makes chips for Qualcomm and MediaTek, amongst others, confirmed the layoffs and hiring freeze to Bloomberg however didn’t go into any extra element, resembling what number of jobs can be affected or which elements of the enterprise the ax would fall on.
“A few of our prospects have requested to modestly modify a few of their 2023 shipments downward, significantly with respect to the primary half of 2023,” CEO Dr. Thomas Caulfield stated as he opened the earnings name. Then, in a quote launched to the media, continued: “Within the third quarter, the GF crew continued to execute on its commitments to prospects and shareholders regardless of ongoing macroeconomic and geopolitical challenges.”
He added: “300mm-equivalent wafer shipments of 637,000 was a document for GF, a rise of 5% year-over-year. Our income grew 22% year-over-year, and we delivered document gross, working, and web earnings, making important progress towards our long-term monetary mannequin. We stay on observe to ship a robust yr of development and profitability.”
GlobalFoundries additionally introduced it will promote its plant in New York state to Onsemi in a deal value $430 million. The plant, which IBM used earlier than GlobalFoundries moved in, employs 1,000 individuals who will now switch to the brand new proprietor, although it’s unclear whether or not these shall be counted among the many layoffs. The agency has additionally acquired $30 million in federal funding to advance the ‘innovation and manufacturing’ of next-generation gallium nitride-on-silicon chips at its plant in Vermont.