STMicroelectronics reported a 32% fall in third-quarter profit, hurt by weaker margins and restructuring charges, though revenue came in slightly above expectations.
The Geneva-based semiconductor maker said net income dropped to $237 million in the third quarter from $351 million a year earlier. Revenue slipped 2% to $3.19 billion, while gross margin narrowed to 33.2% from 37.8%.
Operating income fell to $180 million from $381 million a year ago, including $37 million in impairment and restructuring costs linked to its ongoing programme to reshape manufacturing and cut costs. Excluding those items, non-U.S. GAAP operating income was $217 million.
Chief Executive Jean-Marc Chery said demand in personal electronics was higher than expected, while automotive and industrial segments performed broadly in line with forecasts. “Gross margin was slightly below guidance mainly due to product mix within automotive and industrial,” he said in a statement.
Sequentially, revenue rose 15%, and the company’s book-to-bill ratio stayed above one, signalling continued order strength in automotive.
STMicroelectronics quarterly results
STMicroelectronics expects fourth-quarter revenue of about $3.28 billion, an increase of 2.9% from the third quarter, and a gross margin around 35%, including about 290 basis points of unused capacity charges.
The company said this would translate into full-year 2025 revenue of about $11.75 billion, up 22% in the second half compared with the first.
The company also cut its capital expenditure plan to slightly below $2 billion for the year, citing market conditions. “Our priorities remain accelerating innovation, reshaping our manufacturing footprint and strengthening free cash flow,” Chery said.
Net cash from operating activities was $549 million, down from $723 million a year earlier, while free cash flow remained positive at $130 million. Inventory fell slightly to $3.17 billion at the end of the quarter.
STMicroelectronics paid $81 million in dividends and repurchased $91 million of shares during the period. Its net financial position stood at $2.61 billion, with total liquidity of $4.78 billion and total debt of $2.17 billion.
In July, the company announced an agreement to acquire NXP Semiconductors‘ MEMS sensor business for up to $950 million in cash. The deal, financed through existing liquidity, is expected to close in the first half of 2026 subject to regulatory approval.
