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STMicroelectronics NV Expects Another Quarter of Slow Sales, Improving Margins

Image source: STMicroelectronics.

Embedded microprocessor veteran STMicroelectronics NV (NYSE: STM  ) just reported results for the first quarter of fiscal year 2014.

STMicro reported an adjusted net loss of $0.03 per share and American Depositary Receipt, up from a $0.13 loss per share in the year-ago period. Sales declined 9.1% to $1.83 billion. Both numbers were exactly in line with analyst expectations.

The lower sales follow from STMicro exiting the ST-Ericsson joint venture, and would have increased 0.7% year-over-year if that division were excluded from the reported results. In particular, STMicro saw approximately 15.5% year-over-year sales growth in the automotive and MMS (microcontroller, memory, and secure microcontrollers) divisions.

Looking ahead, STMicro CEO Carlo Bozotti put the midpoint of his second-quarter revenue guidance at $1.87 billion -- slightly below the current Street view of $1.93 billion. Gross margins should land near 33.6%, up from 32.8% in the just-reported quarter.

Mr. Bozotti credited the ST-Ericsson wind-down and an improving macro-economic environment for helping STMicroelectronics in the first quarter. "Our general-purpose microcontroller business enjoyed the fourth consecutive quarter of record revenues and today, ST is the second largest player worldwide in microcontrollers, including both general-purpose and secure," Bozotti said in a prepared statement.

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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On May 09, 2014, at 8:44 PM, chris293 wrote:

    This May 9th, 2014 and the information on STM is puzzling, how can a company positive earning and a negative P/E? Besides paying a dividend from what sources? Do they have deep pockets? This would be nice to know/

  • Report this Comment On September 19, 2014, at 11:12 PM, David915 wrote:

    I understand that STMicroelectronics owns the patents to many useful MEMS. (Micro-Electro-Mechanical Systems) which are now being touted for the medical profession.

    Should the MEMS catch hold I will bet that STM stock will skyrocket upward to great hights. Anyone else out there know more about this possibility?

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Anders Bylund

Anders Bylund is a Foolish Technology and Entertainment Specialist. Where the two markets intersect, you'll find his wheelhouse. He has been an official Fool since 2006 but a jester all his life.

Hypoallergenic. Contains six flavors not found in nature. Believes in coyotes and time as an abstract.

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8/31/2015 4:06 PM
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