Stmicroelectronics N.v Stock Earnings Reports

STMicroelectronics reported Q1 2026 revenue of $3.1 billion (including ~$40M from the newly acquired NXP MEMS sensor business). Book-to-bill was well above 1 across end markets. Year-over-year growth was led by Communication Equipment & Computer Peripherals (+41%), Industrial (+26%), Personal Electronics (+21%) and Automotive (+15%). Gross margin was 33.8% (34.1% ex-PPA), with non‑GAAP EPS of $0.30 after excluding impairments and PPA effects. Free cash flow was negative (~$720–$723M) primarily due to the ~$895M cash payment for the NXP MEMS acquisition. Inventories in distribution are normalized; consolidated inventory rose slightly to $3.17B (140 days). Management highlighted strong momentum in AI/data-center opportunities (confirming data-center revenues “nicely above $500M” in 2026 and “well above $1B” in 2027) with a multiyear commercial engagement with AWS and wins across silicon, SiC and silicon photonics (PIC100). The company is executing a manufacturing reshaping program (capacity transfers 200→300mm, 6→8 inch SiC) that creates temporary manufacturing inefficiencies and one‑time charges, with benefits expected to materialize more into late 2027/2028. Q2 2026 outlook: revenue $3.45B ±3.5% and gross margin ~34.8% (35.2% non‑GAAP). OpEx guidance was increased for 2026: like‑for‑like net OpEx expected to rise mid‑ to high‑single digits (low double‑digit if including the NXP acquisition and FX), reflecting accelerated investment in new business opportunities; however, OpEx/sales ratio should decline year‑over‑year. Management expects sequential gross‑margin improvement through H2 2026 as utilization, mix and reduced unused capacity charges offset temporary reshaping costs. Key strategic growth drivers: AI/data-center infrastructure (power, microcontrollers, photonics), expanded MEMS sensor portfolio (NXP asset), silicon carbide for EV powertrains, and low‑earth‑orbit satellite opportunities (targeting cumulative >$3B for 2026–28).