GLOBALFOUNDRIES Inc. (NASDAQ:GFS) Q3 2023 Earnings Call Transcript

David Reeder: Sure. Maybe I’ll start with that one. And let me just take a more macro view first and then maybe come back and address specifically some of the questions. I think we mentioned earlier in the call that we are taking just in general a cautious approach given the fact that we still have persistently high inflation. We’ve got some inventory in the channel, a couple of wars going on. But that aside, the specific guidance that we’ve kind of given for the year is that we’ve given that we expect to be in the low to mid-80s from the utilization perspective for all of 2023. For the first half we were kind of mid to high-80s. Obviously, that implies a lower utilization heading into the second half of this year, which is very much I think consistent with the fact that we’re starting to see inventories drain now.

And so, you’re seeing utilization rates come down as that inventory is being drained. So I think sequentially from fourth quarter to first quarter, I think the industry has historically seen a decline with just seasonality perspective weighing in. And so, when we think about this year, I would say higher utilizations in the first half, lower utilizations in the second half, consistent with that inventory decrease. And then, when you think about rolling into next year, you typically have some seasonality, which is pretty well documented in the industry. So I think with that, we’d probably leave the guidance there with respect to anything 2024.

Harlan Sur: Yes. No, appreciate that. And then last call the team had anticipated based on your LTSAs and new customer engagements that overall like-for-like wafer pricing would be relatively stable-ish next year versus this year. Is that still the case?

David Reeder: Sure. With respect to our LTAs, like-for-like pricing is pretty flat. So, been pretty consistent on that point. Remember those LTAs had fixed price, fixed volume, fixed duration. Obviously, as we’ve gone through the year and we’ve had some inventory that had to be worked out. Obviously, we’ve had to renegotiate some of those elements. But I would say, by and large, from a pricing perspective, like-for-like is really pretty stable and somewhat constructive.

Harlan Sur: Okay. Perfect. Thank you.

Operator: At this time, the Q&A session has now ended. I will now turn the conference over to Sam Franklin for closing remarks.

Sam Franklin: Thanks Antoine, and thanks everyone for joining the call today. Sorry, we couldn’t get to everyone in the call list, but we look forward to speaking to you bilaterally and catching up over the coming months. Thank you.

Operator: This concludes today’s conference. Thank you for participating. You may now disconnect.