GlobalFoundries Inc. (GFS) saw its stock price leap 15% to $81.35 on Thursday, following the U.S. Commerce Department's announcement of a planned $375 million award and the government's acquisition of a roughly 1% equity stake in the contract chipmaker. The surge came on trading volume of 11 million shares, more than triple the previous day's activity, according to company data.
The deal is part of a broader $2 billion federal package aimed at advancing quantum computing technology across nine companies, as reported by Reuters. Quantum computing, still in its early stages, promises to solve complex problems far faster than traditional computers. The U.S. government's involvement underscores its strategic push to keep advanced chip manufacturing and quantum development within American borders.
In response, GlobalFoundries launched a new business unit called Quantum Technology Solutions, which will focus on producing hardware for quantum systems. This includes quantum processor units (QPUs) and control chips designed to operate at extremely low temperatures. CEO Tim Breen emphasized that the partnership with the U.S. government would ensure next-generation quantum systems are "developed and manufactured in the U.S." Chief Technology Officer Gregg Bartlett noted the shift is moving "from lab-scale to industrial scale."
The announcement had a wide ripple effect across the sector. IBM is set to receive $1 billion for a new quantum-chip venture named Anderon, while D-Wave Quantum and Rigetti Computing are each expected to get around $100 million. IBM CEO Arvind Krishna told Reuters that the new venture would offer customers the "exact same capability" IBM uses for itself.
Investors also took note of the deal's structure, which includes equity stakes rather than just grants. Commerce Secretary Howard Lutnick stated the investments would create "thousands of high-paying American jobs." Infleqtion CEO Matthew Kinsella remarked to Reuters that the move suggests quantum computing is coming "much faster than anybody thinks."
GlobalFoundries had already been on a positive trajectory this month. The company reported first-quarter revenue of $1.63 billion and non-IFRS earnings of 40 cents per share, with adjusted results excluding certain items. Shortly after, it announced its first quarterly dividend of 12 cents per share, payable July 14 to shareholders of record on June 24.
However, the rally leaves little margin for error. The Commerce agreement remains a letter of intent, not a finalized payment, and quantum computers still face significant technical hurdles, including high error rates that limit practical applications. GlobalFoundries also cautioned in its release that expected funding could be delayed or withheld, a risk that might prompt profit-taking after Thursday's sharp move.
Regular U.S. stock trading resumes Friday at 9:30 a.m. Eastern, with markets closed Monday, May 25, for Memorial Day. The next company-facing event is May 27, when GlobalFoundries is scheduled to appear at TD Cowen's technology, media, and telecom conference. The near-term test for the stock is whether Thursday's quantum premium holds once trading normalizes, or if investors view the U.S. stake as a one-day event rather than a new baseline.
