STMicroelectronics Reports 2024 Third Quarter Financial Results
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Key Financial Metrics Segment Revenue Performance Key Developments Management Commentary Dividend and Share Repurchase Forward Guidance Stock Price MovementFree Financial AI Agent for Investment
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Is STM.N earnings result positive or negative?How should I trade on STM.N earnings?STMicroelectronics Reports 2024 Third Quarter Financial Results
Geneva, October 31, 2024 – STMicroelectronics N.V. (NYSE:STM), a global semiconductor leader, announced its financial results for the third quarter, ending September 28, 2024.
Key Financial Metrics
| Metric | Q3 2024 | Q3 2023 | YoY Change | Q2 2024 | QoQ Change | Consensus Estimate |
|---|---|---|---|---|---|---|
| Revenue | $3.25 billion | $4.43 billion | -26.6% | $3.23 billion | +0.6% | $3.25 billion |
| Earnings Per Share (EPS) | $0.37 | $1.16 | -68.1% | N/A | N/A | $0.33 |
| Net Income | $351 million | $1.09 billion | -67.8% | N/A | N/A | N/A |
STMicroelectronics reported steady quarterly revenue with a year-over-year decline primarily due to market challenges. Despite pressure from increased capacity charges affecting the gross margin, EPS surpassed analyst expectations, indicating resilient cost management.
Segment Revenue Performance
| Segment | Revenue Q3 2024 | YoY Change | Operating Margin Q3 2024 | Operating Margin Q3 2023 |
|---|---|---|---|---|
| APMS | Decline | -13.3% | 14.8% | 21.8% |
| P&D | Decline | -18.4% | 15.0% | 26.5% |
| MCU | Decline | -43.4% | 14.0% | 36.4% |
| D&RF | Decline | -29.7% | 26.8% | 37.3% |
The company's major segments faced significant revenue decreases, with the Microcontrollers segment notably impacted. The reduction in operating margins across all segments reflects ongoing market softness and competitive dynamics.
Key Developments
- Launched a program to enhance wafer fab capacity, transitioning to 300mm Silicon and 200mm Silicon Carbide.
- Planning to resize the global cost base to enhance operating efficiency.
Management Commentary
Jean-Marc Chery, ST President and CEO, highlighted that the third-quarter revenue aligned with the company's guidance, with variances across key markets. A strategic emphasis was placed on improving manufacturing capabilities and operating efficiencies, with cost-saving initiatives expected to yield benefits by 2027.
Dividend and Share Repurchase
- Paid $80 million in cash dividends.
- Executed a share buyback totaling $92 million under the ongoing repurchase program.
Forward Guidance
STMicroelectronics provides a cautious outlook for the fourth quarter, projecting net revenues of $3.32 billion and a gross margin around 38%. The company anticipates revenue declines substantially above typical seasonality heading into early 2025.
Stock Price Movement
Post-earnings release, STMicroelectronics' stock saw a decrease of approximately 4.74%, reflecting market reactions to the ongoing challenges and future outlook.
In conclusion, while STMicroelectronics faces market adversities, strategic initiatives and cost management efforts are being sharpened to navigate through the current market landscape effectively.
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