STMicroelectronics (STM) has reduced its sales outlook for fiscal 2024 following a decline in Q1 revenue and net profit. Despite this, the company’s shares rose by 1.7% in premarket trading on Thursday. The earnings per share (EPS) for the quarter were reported at $0.54, missing the consensus estimate of $0.63.
STMicro’s Q1 revenue fell by 18% to $3.47 billion, falling short of the $3.64 billion anticipated by analysts. Net profit also saw a significant decrease, halving from $1.04 billion to $513 million. Gross profit for the quarter decreased to $1.44 billion from $2.11 billion, resulting in a gross margin of 41.7%.
Consequently, the European semiconductor manufacturer has revised its financial outlook for the year downward. It now expects annual revenues to be between $14 billion and $15 billion, down from the previously projected range of $15.9 billion to $16.9 billion. Additionally, gross margins are anticipated to stabilize in the low 40s percentage range, a shift from earlier forecasts of low to mid-40s.
For the upcoming quarter, STMicroelectronics has set a revenue target of $3.2 billion and a gross margin goal of 40%. Analysts noted, “We have been cautious on STM into these results in anticipation of significant cuts, especially due to severe weakness in the company’s general-purpose MCU business. However, the level of cuts exceeds our expectations. We would also not rule out some price pressure in the MCU business in the channel in H2-24. While we are likely to be at or close to the bottom in terms of revenues and margins, we remain somewhat cautious on the slope of recovery into H2-24 and 2025.”
 has reduced its sales outlook for fiscal 2024 following a decline in Q1 revenue and net profit. Despite this, the company's shares rose by 1.7% in premarket trading on Thursday....){kind=link}