Shares of GLOBALFOUNDRIES Inc. (GFS) surged 7.07% during intraday trading on Thursday, extending a rally that began in the pre-market session. The sharp upward move reflects strong investor enthusiasm following a major federal funding announcement.

The catalyst for the surge is the company's disclosure that it signed a letter of intent with the US Department of Commerce to receive up to $300 million under the CHIPS Research and Development program. The proposed award is dedicated to accelerating next-generation silicon photonics technology, a critical enabler for co-packaged optics and high-speed data interconnects central to AI infrastructure. As part of the arrangement, the Department of Commerce will acquire approximately 1% equity in GlobalFoundries. The funding is part of a broader $874 million semiconductor R&D initiative announced by the US government.

The positive momentum reverses a prior decline of over 10% across the two preceding sessions, which was attributed to broad-based weakness in the semiconductor sector. Investors are also looking ahead to the company's second-quarter earnings report scheduled for August 5, with consensus estimates projecting year-over-year revenue and earnings growth.