STMicroelectronics Shares Jump on Strong 4Q Revenue, 2020 Guidance
January 23 2020 - 5:18AM
Dow Jones News
By Mauro Orru
Shares of STMicroelectronics NV (STM.FR) jumped on Thursday as
results for the fourth quarter of 2019 and guidance for the first
quarter of 2020 exceeded expectations.
The European semiconductor chip maker said fourth-quarter
revenue rose 4% year-on-year to $2.75 billion, spurred by higher
sales across the analog, microcontrollers, imaging and MEMS
divisions.
STMicroelectronics shares traded 6.6% higher at EUR27.03 at 0947
GMT.
Analysts at Citi said revenue exceeded its expectations of $2.68
billion, as did the gross margin, which came in at 39.3% compared
with the U.S. bank's estimate of 38.2%.
However, quarterly net profit fell 6.2% year-on-year to $392
million, with income-tax expenses of $62 million.
STMicroelectronics said it expects net revenue of $2.36 billion
for the first quarter of 2020, a 13.7% year-on-year increase.
The company also plans to invest roughly $1.5 billion in capex
for 2020, it added.
"The outlook for 1Q 2020 and that on capex should justify, in
our view, a positive review of the sales estimate for 2020 (our
estimate and consensus up 8%)," said Gianmarco Bonacina, analyst at
Italian investment bank Equita Sim.
Frederic Yoboue, analyst at European investment bank Bryan
Garnier said the investment in capex is also above its forecast of
$1.37 billion, adding this should highlight strategic initiatives
such as the next generation of imaging sensor technologies.
Write to Mauro Orru at mauro.orru@wsj.com; @MauroOrru94
(END) Dow Jones Newswires
January 23, 2020 05:03 ET (10:03 GMT)
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