SerpApi.Org
European chipmaker STMicroelectronicsSTM early Thursday beat analyst estimates for the second quarter but disappointed with its Q3 sales guidance. STM stock fell on the news.
The Geneva, Switzerland-based company earned an adjusted 31 cents a share on sales of $3.49 billion in the June quarter. Analysts polled by FactSet had expected earnings of 27 cents a share on sales of $3.46 billion. On a year-over-year basis, STMicro earnings jumped 417% while sales increased 26%.
For the current quarter, it forecast revenue of $3.7 billion, missing views for $3.79 billion. In last year's Q3, it posted sales of $3.19 billion. Its outlook translates to year-over-year sales growth of 16%.
However, it predicted Q4 revenue will be "above $4 billion," vs. estimates for $4 billion. In last year's Q4, it generated sales of $3.33 billion.
In premarket trades on the stock market today, STM stock sank more than 14% to 56.32.
STM stock hit an all-time high of 81.42 on June 3, following a steady climb after its first-quarter results on April 23.
On April 6, STM stock broke out of a flat base at a buy point of 35.07, according to IBD MarketSurge charts.
STMicroelectronics makes semiconductors for devices in end markets such as automotive, industrial and wireless. Its products include power management chips, sensors, microcontrollers, and radio-frequency and optical communications chips.
STM Stock Drivers: AI, LEO Satellites
Lately STMicro has gotten a lift from its exposure to AI data centers and low-earth-orbit satellite communications networks.
"During the quarter demand increased further, with strong bookings in all end markets," Chief Executive Jean-Marc Chery said in a news release. "We saw improved visibility and signs of tight supply in several product categories. Inventory in distribution is now below our standard target."
He added, "We anticipate a revenue growth acceleration in Q4, mainly driven by our engaged customer programs in AI data centers and LEO satellite communication."
Follow Patrick Seitz on X at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
YOU MAY ALSO LIKE:
Texas Instruments Delivers Beat-And-Raise Earnings Report, But Stock Falls
AMD, Cerebras Strike AI Chip Deals
Discover Profitable Trades Each Day With MarketDiem. See How.
Find Winning Stocks With MarketSurge Pattern Recognition & Custom Screens