Citi Technology Conference
September 04, 2012 01:30 PM ET
Philippe Lambinet - Chief Corporate Strategy Officer and General Manager
Amit Harchandani - Citi
Amit Harchandani - Citi
Okay I guess we will get started, first of all thanks to all of you for joining us today. I am Amit Harchandani, I head the European Technology coverage for Citi based out of London and I am also the covering analyst for STM. I am delighted to have STM join us again this year and from STM today we have Philippe Lambinet and Tait Sorensen, Tait is Director of IR and Philippe I guess, those of you who are new to the STM is the firm's Chief Corporate Strategy Officer and the General Manager of the Digital Sector. In fact he is a chip veteran having spent probably 30 years, best part of 30 years of his life looking at chips of all shapes and sizes. So, without further delay I think Philippe said let’s quickly jump into Q&A straight-off so that’s what we are going to do. So, as a start maybe just to get the discussion going Philippe if you could just tell us what are you seeing in the market today. I mean STM is probably the best candidate given your diversified positioning to talk about the broader market trend, how would you characterize current demand versus the first half and is it better, worse, same, is it the same across different product segment?
When we published our results that the end of July for Q2, we already communicated that the following trend which we saw starting mid-last year an inventory correction and we saw the end of that inventory correction in Q1 this year and the only part of Q2 was actually quite positive. We had a good rebound, April and May bookings were quite good, so we were quite optimistic for the rest of the year. Now when we again when we published our result in July we said let’s not be too bullish, the June bookings and the July bookings have not been very good. The market is softening. What I can say is that softening is continuing. The August bookings have continued to be not very strong. So, it's too early to say whether it will rebound now and in Q4 or whether it's going to be a double dip and it will further weaken. Right now it's flattish so we had taken a flattish booking situation into account in our guidance for Q3 so we have no reason to change our guidance but it's a bit early to say how we will guide for Q4 and of course we will have another month and half before we have to do this but definitely the weakness is there, continues to be there. It's across all applications and it's across all regions, so there isn’t particularly dark spot and there isn’t a particularly bright spot I think all of the market is pretty weak.