Chipmaker STMicroelectronics (STM) revised its full-year revenue and margin forecasts downward for the second time on Thursday, citing persistent weakness in industrial customer orders and a decline in automotive demand.
The Franco-Italian company, which serves clients like Tesla and Apple, now expects its 2024 revenue to be between $13.2 billion and $13.7 billion, down from its previous forecast of $14 billion to $15 billion. The company also revised its margin expectations to approximately 40%, from the earlier “low 40s” range.
CEO Jean-Marc Chery explained that customer orders for industrial applications did not improve as expected, and demand in the automotive sector also decreased. STM, which produces a variety of chips including microcontrollers and sensors for smartphones and vehicles, has faced challenges due to reduced industrial demand and high inventory levels.
Additionally, the demand for electric vehicles (EVs) in Europe has significantly slowed, with recent data from the region’s trade body indicating only a 1.3% increase in sales during the first half of the year.
while the forecast adjustment was anticipated, the extent of the revision was somewhat more severe than expected. STM had previously lowered its outlook in April, attributing it to declining demand from automotive and industrial clients. For the second quarter, the company’s revenue reached $3.23 billion, slightly above the $3.2 billion expected by analysts, with margins reported at 40.1%.
 revised its full-year revenue and margin forecasts downward for the second time on Thursday, citing persistent weakness in industrial customer orders and a decline in automotive demand.){kind=link}