STMicroelectronics beats third quarter sales forecasts

EUROPEAN chipmaker STMicroelectronics beat expectations on Thursday (Oct 26) for third quarter sales, helped by demand from the automotive sector.

However, the company, whose clients include Tesla and Apple, said it expects a drop in sales in the fourth quarter.

Third quarter net revenues rose 2.5 per cent year on year to US$4.43 billion, beating the average of US$4.38 billion expected by analysts in a Refinitiv poll.

“As expected, the revenue performance was driven mainly by continued growth in Automotive, partially offset by lower revenues in Personal Electronics,” said Jean-Marc Chery, the group’s chief executive.

STMicroelectronics said it expects fourth quarter sales to fall about 3 per cent year on year to US$4.30 billion.

Demand from car makers has helped the semiconductor sector offset the impact of US-China trade spats and sluggish demand for personal electronics.

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However, auto manufacturers are now saying that demand for electric vehicles – a key growth driver – could be poised for a slowdown.

STMicroelectronics on Thursday added it projects a gross margin of 46 per cent in the fourth quarter, give or take 200 basis points. REUTERS