- STMicro’s gross margin for Q2 was 33.5%, slightly below the estimated 33.6%.
- Net revenue reached $2.77 billion, surpassing the estimate of $2.74 billion.
- Analog, Power & Discrete, MEMS and Sensors products generated $1.58 billion in net revenue, meeting expectations.
- Microcontrollers, Digital ICs, and RF products exceeded expectations with $1.18 billion in net revenue, compared to the estimate of $1.15 billion.
- Operating income for Analog, Power & Discrete, MEMS and Sensors was $29 million, significantly below the $85.1 million estimate.
- In contrast, Microcontrollers, Digital ICs, and RF Products reported an operating income of $174 million, outperforming the estimate of $138.5 million.
- The company experienced negative free cash flow of $152 million, against the expected positive $167.1 million.
- Research and Development (R&D) expenses were $514 million, higher than the estimated $494.1 million.
- Capital expenditure amounted to $481 million.
- Q2 net revenues were bolstered by strong performance in Personal Electronics and Industrial sectors, though Automotive lagged behind expectations.
- STMicro plans to focus on customer support, accelerating new product introductions, and adjusting their manufacturing and cost structures.
- The company anticipates a sequential decrease of about 140 basis points in Q3 gross margin, mainly due to currency effects and manufacturing restructuring costs.
- Current stock recommendations include 10 buys, 13 holds, and 2 sells.
A look at STMicroelectronics Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 4 | |
| Dividend | 2 | |
| Growth | 3 | |
| Resilience | 4 | |
| Momentum | 5 | |
| OVERALL SMART SCORE | 3.6 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
STMicroelectronics N.V., a semiconductor company specializing in integrated circuits and discrete devices, has a promising long-term outlook, as indicated by its Smartkarma Smart Scores. The company ranks high in Momentum with a score of 5, showcasing strong market performance and potential growth opportunities. Additionally, STMicroelectronics demonstrates solid Value and Resilience with scores of 4 in both categories, underlining its competitive position and ability to withstand market fluctuations.
Despite having a lower score in Dividend and Growth at 2 and 3 respectively, STMicroelectronics‘ overall outlook remains positive, with a balanced combination of strengths across various factors. The company’s diversified product range and customer base across North America, Europe, and Asia Pacific position it well for continued success in the semiconductor industry.
Summary: STMicroelectronics N.V. is a semiconductor company that designs, develops, manufactures, and markets integrated circuits and discrete devices for sectors such as telecommunications, consumer electronics, automotive, and industrial applications. Its customer base spans across North America, Europe, and the Asia Pacific region.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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