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STMicroelectronics Reports 2013 Third Quarter And Nine Month Financial Results

Stocks in this article: STM

  • Third quarter net revenues $2.01 billion; excluding Wireless product line up 3.9% year-over-year and 0.5% sequentially
  • Third quarter operating income was a profit of $54 million before impairment and restructuring charges
  • Transaction to split up ST-Ericsson completed

GENEVA, Switzerland , Oct. 22, 2013 (GLOBE NEWSWIRE) -- STMicroelectronics (NYSE:STM), a global semiconductor leader serving customers across the spectrum of electronics applications, reported financial results for the third quarter and nine months ending September 28, 2013.

Third quarter net revenues totaled $2,013 million and gross margin was 32.4%. ST's third quarter net loss was $142 million as the Company took a charge of $120 million, mostly non-cash, in connection with its annual third quarter impairment review and already announced restructuring initiatives.

"Our financial performance during the third quarter was mixed. On one hand, we saw overall year-over-year revenue improvement of 3.9 percent across our business outside of the Wireless product line. We believe this exceeds the year-over-year revenue performance of our served market. On the other hand, this growth was milder than expected due to a muted order pattern during the quarter driven by softness in high-end smartphones in Asia and the mass market in Asia, including the cable set-top box market in certain countries," said ST President and CEO Carlo Bozotti.

"However, we did see sequential growth in Imaging, Microcontrollers, MEMS, and Automotive. In particular, Microcontrollers posted record quarterly billings led by our general-purpose products.

"During the third quarter the Company posted an operating profit before impairment and restructuring charges. ST's operating income excluding these charges was $54 million, improving by $118 million on a sequential basis. This is due in large part to the sale of ST-Ericsson's Global Navigation Satellite System business along with lower operating expenses.

"In August, we completed the transaction to split up ST-Ericsson in a timely manner. With this we are strengthening our product development in key areas where we see important customer expansion opportunities including embedded processing, RF, analog and power."

Summary Financial Highlights

U.S. GAAP (Million US$) Q3 2013 Q2 2013 Q3 2012
Net Revenues (a) 2,013 2,045 2,166
Gross Margin 32.4% 32.8% 34.8%
Operating Income (Loss), as reported (66) (107) (792)
Net Income (Loss) attributable to parent company (b) (142) (152) (478)
(a) Net revenues include sales recorded by ST-Ericsson as consolidated by ST      
(b) Includes a loss on equity-method investment of $8 million, $89 million and $4 million in the third and second quarters of 2013 and the third quarter of 2012, respectively      
Non-U.S. GAAP* Before impairment and restructuring charges (Million US$) Q3 2013 Q2 2013 Q3 2012
Operating Income (Loss) 54 (64) (79)
Operating Margin 2.7% (3.1%) (3.6%)

Completion of ST-Ericsson Transaction

On August 2, 2013, ST and Ericsson completed in a timely manner, with lower exit costs than anticipated and with a minimized social impact, the transaction to transfer the activities of ST-Ericsson to the respective parent companies. With this, approximately 1,000 employees have joined ST. ST has taken on the existing ST-Ericsson products, other than LTE multimode thin modems and the GNSS (Global Navigation Satellite System) connectivity solution sold to a third party, and related business as well as certain assembly and test facilities.

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