IN Brief:
- Second-quarter revenue increased 6% year on year to $1.786 billion.
- GlobalFoundries has acquired integrated-voltage-regulator technology to complement its BCD, gallium-nitride, and integrated-inductor capabilities.
- A proposed $300 million US award would support optical materials, wafer technologies, and advanced photonics packaging.
GlobalFoundries is expanding its silicon-photonics and integrated power capabilities as rising AI infrastructure demand places greater pressure on optical interconnects and voltage delivery.
The foundry reported second-quarter revenue of $1.786 billion, 6% higher than a year earlier and 9% above the previous quarter. Wafer shipments, expressed as 300mm equivalents, rose 8% year on year to 625,000, while gross margin increased from 24.2% to 28.3%.
Optical networking was identified as one of the company’s strategic growth areas. GlobalFoundries said demand for its silicon-photonics and silicon-germanium technologies was accelerating in AI data centres, where traffic between accelerators, switches, memory, and storage is increasing faster than conventional electrical links can comfortably accommodate.
The commercial update was accompanied by a letter of intent with the US Department of Commerce for an expected $300 million award. The proposed funding would support next-generation optical materials, wafer technologies, and advanced packaging, although the agreement remains subject to the government award process rather than representing completed funding.
GlobalFoundries has also completed its acquisition of Photeon Technologies’ integrated-voltage-regulator business. The transaction adds specialist engineering capability and IVR technology to a portfolio that already includes bipolar-CMOS-DMOS processes, gallium nitride, and integrated inductors.
The objective is to extend the foundry’s role beyond manufacturing discrete devices towards process platforms that combine conversion, regulation, and passive integration closer to compute silicon. Moving voltage regulation nearer to the load can reduce distribution losses and improve the response to rapidly changing accelerator current demand.
Optical connectivity and power delivery are separate engineering disciplines, but both have become physical constraints in high-density AI systems. Optical links are moving closer to processors to reduce the reach and energy penalties associated with electrical signalling, while voltage conversion is being distributed across racks, boards, and packages to control losses and thermal density.
No single process can serve every function. Silicon photonics requires repeatable waveguides, modulators, photodetectors, and low-loss interfaces, supported by packaging capable of aligning fibres or light sources at volume. Integrated regulation must balance switching frequency, conversion efficiency, control stability, thermal performance, and compatibility with the voltage and current requirements of the surrounding package.
Foundry scale becomes important when these technologies move beyond demonstrations. Yield must be maintained across optical structures, analogue controls, passive devices, and packaging steps, while design kits and qualification data have to be mature enough for customers to commit expensive systems to production.
A process advantage that cannot be reproduced across several wafer lots is of limited value to infrastructure expected to operate continuously for years. Test coverage, process monitoring, and package-level reliability will therefore matter as much as the performance of an individual optical or power device.
The wider portfolio is also being broadened through the completed acquisition of Synopsys’ ARC Processor IP Solutions business. Combined with MIPS, the deal gives GlobalFoundries access to RISC-V processor intellectual property, software tools, custom-design capability, and manufacturing under one commercial structure.
That software-to-silicon positioning extends beyond the immediate optical and power story, but it reflects the same attempt to capture more of the engineering work surrounding a wafer. Customers increasingly need qualified platforms, packaging routes, design tools, and processor options rather than an isolated manufacturing process.
Second-quarter operating margin was 9.7%, down from 11.6% a year earlier despite the stronger gross margin. Research and development expenditure rose to $174 million from $134 million, while selling, general, and administrative spending doubled to $157 million.
GlobalFoundries expects third-quarter revenue of $1.885 billion, plus or minus $25 million, with an IFRS gross margin of 29.5%, plus or minus one percentage point. The more useful measure for the new programmes will be customer qualification and production volume rather than another collection of AI-related design announcements.
The company now has acquired technology, proposed funding, and rising optical demand aligned around the same infrastructure constraints. Execution will depend on turning those elements into qualified, repeatable foundry processes before power delivery and interconnect become still more expensive limits on system deployment.
