STMicroelectronics Reports 3Q 2021 Financial Results

STMicroelectronics reported US GAAP financial results for the third quarter ended Oct. 2, 2021.

Net revenues totaled $3.20 billion, a year-over-year increase of 19.9%. On a year-over-year basis, the company 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.

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. Third quarter 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.

“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,” Jean-Marc Chery, STMicroelectronics president and CEO, said. “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,” added Chery. “On a year-over-year basis, Q3 operating margin of 18.9% improved from 12.3%, and net income nearly doubled to $474 million. “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.”