Chipmaker STMicroelectronics beats estimates, lifts 2022 outlook

STMICROELECTRONICS raised its full-year outlook on Thursday (Jul 28) after the Franco-Italian chipmaker beat second-quarter revenue expectations helped by strong demand for chips used in products ranging from smartphones to cars.

The group, whose top clients include iPhone maker Apple and electric carmaker Tesla, strongly benefits from a surge in power-management semiconductors as the auto industry moves to low-emission vehicles, and from automation in multiple industries.

"Bookings remained strong across all customers and geographies," CEO Jean-Marc Chery said in the call to analysts. "Backlog visibility is now above 18 months and well above our current and planned manufacturing capacity through 2023."

STMicro's shares were up 2.5 per cent at 0906 GMT.

The high demand for chips was also underpinned by the Covid-19 pandemic, which stimulated sales of smartphones and computers as people worked from home. Research firm Gartner predicted growth will slow later this year and a fall in chip demand next year.

STMicro lifted its 2022 revenue forecast to between US$15.9 billion and US$16.2 billion from a range of US$14.8 billion to US$15.3 billion.

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It forecast third-quarter net revenue of US$4.24 billion, beating an estimate of US$3.81 billion.

STMicroelectronics and GlobalFoundries announced plans this month to build a chip factory in France, with the help of government funding.

The facility, which will be next to STM's plant in Crolles, would create about 1,000 new jobs and help STMicro reach its goal of boosting revenue above US$20 billion.

The Geneva-based company's quarterly net revenue rose to US$3.84 billion from US$3.0 billion a year earlier, beating analysts' estimate of US$3.69 billion, IBES data from Refinitiv showed.

Its diluted earnings rose to 92 cents a share, beating an estimate of 76 cents a share. REUTERS