STMicroelectronics (NYSE:STM) Posts Earnings Results, Misses Estimates By $0.06 EPS

Key Points

• Reported EPS $0.13, missing estimates by $0.06 while revenue was roughly in line at $3.10B; however profitability was weak (net income $37M, net margin ~1.4%, ROE ~2.7%) and free cash flow was about ‑$720M after an $895M acquisition cash out and $71M of impairment/restructuring.
• Management guided Q2 revenue to $3.45B (±350bp), implying ~+11.6% sequential growth and reiterated double‑digit revenue growth for 2026, while projecting data‑center revenues "nicely above $500M" in 2026 and "well above $1B" in 2027 as it ramps AI initiatives.
• ST completed the acquisition of NXP's MEMS sensor business (≈$40M contribution in Q1) and has begun high‑volume production of the PIC100 silicon‑photonics platform, plus a multiyear, multibillion‑dollar engagement with Amazon Web Services, although the deals add PPA effects and incremental OpEx that pressure near‑term margins.

STMicroelectronics (NYSE:STM - Get Free Report) released its quarterly earnings results on Thursday. The semiconductor producer reported $0.13 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.19 by ($0.06), Zacks reports. STMicroelectronics had a return on equity of 2.70% and a net margin of 1.41%.The firm had revenue of $3.10 billion for the quarter, compared to analysts' expectations of $3.11 billion.

Here are the key takeaways from STMicroelectronics' conference call:

• Q1 revenues $3.1B with book‑to‑bill well above 1 across all end markets; company guides Q2 revenues to $3.45B (±350bp), implying +11.6% sequential growth and reiterates double‑digit revenue growth for 2026.
• ST is positioning for a major AI/data‑center ramp — expects data‑center revenues "nicely above $500M" in 2026 and "well above $1B" in 2027, has started high‑volume production of the PIC100 silicon‑photonics platform and secured a multi‑year, multibillion‑dollar engagement with Amazon Web Services.
• Completed the acquisition of NXP's MEMS sensor business (≈$40M contribution in Q1) and says integration is on track to strengthen automotive sensor design wins, though it brings PPA effects and incremental OpEx.
• Q1 profitability and cash flow were impacted by restructuring and acquisition payments — reported net income $37M (non‑GAAP EPS $0.13), free cash flow ≈‑$720M including $895M acquisition cash out, plus $71M of impairment/restructuring and ongoing manufacturing reshaping costs that weigh on near‑term gross margin.

STMicroelectronics Price Performance

Shares of NYSE:STM opened at $49.71 on Friday. The company has a market cap of $44.65 billion, a P/E ratio of 276.18 and a beta of 1.51. STMicroelectronics has a 12-month low of $21.11 and a 12-month high of $51.40. The company has a quick ratio of 2.43, a current ratio of 3.36 and a debt-to-equity ratio of 0.10. The company's fifty day moving average is $35.52 and its two-hundred day moving average is $29.74.

Institutional Inflows and Outflows

Several large investors have recently added to or reduced their stakes in STM. CIBC Private Wealth Group LLC increased its position in STMicroelectronics by 3,746.2% in the 4th quarter. CIBC Private Wealth Group LLC now owns 1,000 shares of the semiconductor producer's stock worth $26,000 after purchasing an additional 974 shares during the last quarter. Advisory Services Network LLC acquired a new stake in shares of STMicroelectronics in the third quarter worth $52,000. Brown Brothers Harriman & Co. boosted its holdings in shares of STMicroelectronics by 350.4% during the 4th quarter. Brown Brothers Harriman & Co. now owns 2,680 shares of the semiconductor producer's stock worth $70,000 after buying an additional 2,085 shares during the period. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC bought a new stake in shares of STMicroelectronics during the 4th quarter worth $80,000. Finally, Rakuten Securities Inc. grew its stake in STMicroelectronics by 132.7% in the 2nd quarter. Rakuten Securities Inc. now owns 2,916 shares of the semiconductor producer's stock valued at $89,000 after buying an additional 1,663 shares during the last quarter. Institutional investors and hedge funds own 5.05% of the company's stock.

Wall Street Analyst Weigh In

Several equities research analysts have issued reports on the company. Mizuho set a $48.00 price objective on STMicroelectronics and gave the stock an "outperform" rating in a report on Thursday, April 16th. Morgan Stanley upgraded shares of STMicroelectronics from an "equal weight" rating to an "overweight" rating in a research note on Thursday, March 26th. Craig Hallum upgraded STMicroelectronics from a "hold" rating to a "buy" rating and set a $58.00 target price on the stock in a research note on Thursday. Weiss Ratings downgraded STMicroelectronics from a "hold (c-)" rating to a "sell (d+)" rating in a research report on Friday, March 6th. Finally, Susquehanna upped their price objective on shares of STMicroelectronics from $35.00 to $40.00 and gave the stock a "positive" rating in a report on Monday, February 23rd. Nine research analysts have rated the stock with a Buy rating, three have assigned a Hold rating and two have assigned a Sell rating to the company's stock. According to data from MarketBeat, the stock presently has a consensus rating of "Moderate Buy" and an average price target of $39.07.

STMicroelectronics News Summary

Here are the key news stories impacting STMicroelectronics this week:

• Positive Sentiment: Company set an ambitious AI target and raised near‑term guidance — ST reported Q1 revenue of $3.10B and management is targeting $1 billion in AI revenue by 2027; Q2 revenue guidance came in above consensus (midpoint ~$3.45B). This reinforced an AI-driven growth narrative. Article Title
• Positive Sentiment: Analyst upgrade — Craig Hallum upgraded STM from Hold to Buy and set a $58 price target, adding fresh buy-side interest. Article Title
• Positive Sentiment: Unusual options activity — Traders bought ~30,839 call contracts (≈ +289% vs. typical volume), signaling bullish speculative positioning that can amplify intraday moves.
• Neutral Sentiment: Investor outreach on new markets — ST will host a May 4 webcast on the LEO (Low Earth Orbit) opportunity, showing management is promoting new growth avenues to investors and partners. Article Title
• Neutral Sentiment: ETF positioning spotlight — Coverage noted that STM’s share move has drawn attention to ETFs with large STM weightings, which can increase flow-driven volatility (both upside and downside). Article Title
• Negative Sentiment: EPS miss — Q1 EPS of $0.13 missed consensus ~$0.22, indicating near-term profitability pressure despite revenue strength; investors will watch margin recovery. Article Title
• Negative Sentiment: Low reported profitability metrics — GAAP net margin and ROE were weak (net margin ~1.4%, ROE ~2.7%), highlighting execution risk in converting revenue growth into sustained profit. Article Title

About STMicroelectronics

STMicroelectronics is a global semiconductor company headquartered in Geneva, Switzerland, formed through the 1987 merger of SGS Microelettronica and Thomson Semiconducteurs. The company designs, develops and manufactures a broad range of semiconductor products and solutions that serve multiple end markets worldwide. ST's offerings span from basic components to integrated systems, emphasizing energy-efficient and high-performance devices for modern electronics.

Product categories include microcontrollers (notably the widely used STM32 family), analog and mixed-signal ICs, power MOSFETs and power-management devices, MEMS and sensors, image sensors, and discrete semiconductors.