ST Shares 2021 Third Quarter Financial Results
STMicroelectronics (ST) has recently shared U.S. GAAP financial results for the third quarter ended October 2, 2021.
ST reported third-quarter net revenues of $3.20 billion, gross margin of 41.6%, operating margin of 18.9%, and net income of $474 million or $0.51 diluted earnings per share.
Jean-Marc Chery, STMicroelectronics President & CEO, commented, “Q3 net revenues came in substantially at the mid-point of our business outlook range, up 6.9% sequentially and up 19.9% on a year-over-year basis. The revenue performance was driven by strong global demand and by our engaged customer programs in Personal Electronics. This was partially offset by lower than expected revenues in Automotive, caused by more severe than anticipated reduced operations at our Malaysian manufacturing facility due to the pandemic.
“Q3 gross margin of 41.6% came in 60 basis points higher than the mid-point. On a year-over-year basis, the Q3 operating margin of 18.9% improved from 12.3%, and net income nearly doubled to $474 million.”
- First nine months net revenues increased 31.8% year-over-year, driven by growth in all product groups, except the RF Communications sub-group. The operating margin was 16.7% and net income was $1.25 billion.
- ST’s fourth-quarter outlook, at the mid-point, is for net revenues of $3.40 billion, increasing sequentially by 6.3%; gross margin is expected to be about 43.0%.
- For the full year 2021, we now expect net revenues at the mid-point to be about $12.6 billion, translating into 23.3% year-over-year growth. The revenue growth planned for this year reflects continuing strong dynamics in all the end markets we address and our engaged customer programs.”
Net revenues totaled $3.20 billion, a year-over-year increase of 19.9%. On a year-over-year basis, ST recorded higher net sales in all product groups except the RF Communications sub-group. Year-over-year net sales to OEMs and Distribution increased 9.9% and 48.6%, respectively.
On a sequential basis, net revenues increased 6.9%, substantially in line with the mid-point of the Company’s guidance.
AMS and MDG reported increases in net revenues on a sequential basis while ADG decreased, caused by more severe than anticipated reduced operations at our Malaysian manufacturing facility due to the pandemic.
Gross profit totaled $1.33 billion, a year-over-year increase of 38.7%. Gross margin of 41.6% increased 560 basis points year-over-year, mainly driven by improved product mix, manufacturing efficiencies, favorable pricing and lower unloading charges, partially offset by negative currency effects, net of hedging.
ST third quarter results for gross margin was 60 basis points above the mid-point of the Company’s guidance mainly due to product mix.
Operating income increased 84.0% to $605 million, compared to $329 million in the year-ago quarter. The Company’s operating margin increased 660 basis points on a year-over-year basis to 18.9% of net revenues, compared to 12.3% in the 2020 third quarter.
