STMicroelectronics (NYSE:STM) Releases Earnings Results, Misses Expectations By $0.09 EPS

Key Points

• STMicroelectronics missed Q1 estimates, reporting EPS $0.13 vs. $0.22 expected and revenue $3.10B; Q1 net income was $37M and profitability/cash flow were weighed down by restructuring and M&A, with free cash flow ≈‑$720M (including a $895M acquisition cash out and $71M impairment).
• Management raised the outlook, guiding Q2 revenue to about $3.45B (±350bp) — implying +11.6% sequential growth — and reiterated double‑digit revenue growth for 2026 while highlighting an AI/data‑center ramp (data‑center revenues expected >$500M in 2026 and >$1B in 2027) and a multiyear engagement with Amazon Web Services.
• Despite the earnings miss, the stock jumped roughly 12.6% to around $50.51 intraday as investors cheered the stronger guidance, AI tailwinds, and strategic wins like the PIC100 silicon‑photonics production and NXP MEMS sensor acquisition.

STMicroelectronics (NYSE:STM - Get Free Report) announced its earnings results on Thursday. The semiconductor producer reported $0.13 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $0.22 by ($0.09), Zacks reports. The company had revenue of $3.10 billion for the quarter, compared to analyst estimates of $3.11 billion. STMicroelectronics had a return on equity of 2.70% and a net margin of 1.41%.

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 Stock Up 12.6%

STM stock traded up $5.65 during mid-day trading on Thursday, hitting $50.51. The stock had a trading volume of 14,751,761 shares, compared to its average volume of 8,853,112. The company has a current ratio of 3.36, a quick ratio of 2.43 and a debt-to-equity ratio of 0.10. STMicroelectronics has a 1-year low of $21.11 and a 1-year high of $50.68. The company has a fifty day moving average of $35.19 and a 200 day moving average of $29.60. The stock has a market capitalization of $45.37 billion, a price-to-earnings ratio of 280.63 and a beta of 1.51.

Institutional Trading of STMicroelectronics

Several large investors have recently made changes to their positions in the stock. Smartleaf Asset Management LLC increased its holdings in shares of STMicroelectronics by 13.1% during the 4th quarter. Smartleaf Asset Management LLC now owns 4,405 shares of the semiconductor producer's stock valued at $115,000 after acquiring an additional 509 shares during the last quarter. Earnest Partners LLC increased its holdings in shares of STMicroelectronics by 3.2% during the 4th quarter. Earnest Partners LLC now owns 17,282 shares of the semiconductor producer's stock valued at $448,000 after acquiring an additional 534 shares during the last quarter. Vident Advisory LLC increased its holdings in shares of STMicroelectronics by 2.5% during the 3rd quarter. Vident Advisory LLC now owns 23,196 shares of the semiconductor producer's stock valued at $656,000 after acquiring an additional 573 shares during the last quarter. Northwestern Mutual Wealth Management Co. increased its holdings in shares of STMicroelectronics by 13.5% during the 4th quarter. Northwestern Mutual Wealth Management Co. now owns 6,214 shares of the semiconductor producer's stock valued at $161,000 after acquiring an additional 741 shares during the last quarter. Finally, Captrust Financial Advisors increased its holdings in shares of STMicroelectronics by 7.5% during the 4th quarter. Captrust Financial Advisors now owns 10,748 shares of the semiconductor producer's stock valued at $279,000 after acquiring an additional 750 shares during the last quarter. Institutional investors own 5.05% of the company's stock.

STMicroelectronics News Roundup

Here are the key news stories impacting STMicroelectronics this week:

• Positive Sentiment: Management raised the Q2 outlook: mid‑point revenue guidance of ~$3.45B (company release) — above recent street consensus — and a stronger gross‑margin outlook, suggesting demand and pricing trends improve into Q2. STMicroelectronics Reports Q1 2026 Financial Results
• Positive Sentiment: Analyst upgrade: Craig Hallum bumped STM from "hold" to "buy" with a $58 target (implies upside vs. prior levels), which can drive momentum and buy interest. Finviz Analyst Note
• Positive Sentiment: Company highlighted secular demand drivers (AI, personal electronics, communications) and reported strong YoY revenue growth — press coverage cites AI-driven sales gains that support longer‑term growth narratives. Apple Supplier STMicroelectronics Logs Higher Sales on Strong AI Demand
• Positive Sentiment: ST plans an investor webcast on May 4 to discuss the LEO (low‑Earth orbit) opportunity — signaling management is promoting new addressable markets that could drive multiple expansion. STMicroelectronics to host investor call on the LEO opportunity
• Neutral Sentiment: Company published the Q1 slide deck and conference‑call materials for detail on segment trends and margins — useful for modeling but not an immediate catalyst by itself. Q1 Slide Deck
• Neutral Sentiment: Earnings call transcript is available for detail on product mix and end‑market momentum — worth reviewing for conviction but neutral until new facts emerge. Q1 2026 Earnings Call Transcript
• Negative Sentiment: GAAP EPS disappointed: Q1 GAAP EPS $0.13 vs. consensus ~$0.22 (miss of ~$0.09); net margin and ROE remain low on a GAAP basis — a short‑term concern for earnings‑focused investors. STMicroelectronics Q1 Earnings Summary

Analyst Upgrades and Downgrades

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

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.

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