STMicroelectronics (NYSE:STM) Issues Earnings Results

STMicroelectronics (NYSE:STM) announced its quarterly earnings results on Thursday. The semiconductor producer reported $0.31 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.26 by $0.05, Zacks reports. The company had revenue of $3.49 billion during the quarter, compared to the consensus estimate of $3.46 billion. STMicroelectronics had a return on equity of 3.01% and a net margin of 1.19%.

Here are the key takeaways from STMicroelectronics’ conference call:

• ST reported Q2 revenue of $3.49 billion, above the midpoint of guidance, with strong demand across automotive, industrial, and communications-related markets. Management said bookings were robust and book-to-bill was close to 2 overall, signaling improved visibility.
• AI data center exposure is becoming a larger growth driver: ST raised its 2026 data center revenue target to above $1 billion and now sees it well above $2 billion in 2027, driven mainly by optical connectivity and silicon photonics. Management also said this business should be accretive to gross margin over time.
• Automotive and industrial both accelerated, with automotive revenue up 14% sequentially and industrial up 20% sequentially. The company highlighted design wins in ADAS, powertrain, sensors, industrial automation, and power systems.
• Q3 guidance points to $3.7 billion in revenue at the midpoint and gross margin of about 37%, with management expecting further gross margin improvement in Q4. However, they warned that manufacturing reshaping costs and underloading charges will continue to weigh on margins.
• Cash generation improved, with positive free cash flow of $75 million in Q2, inventory days falling to 126, and the net financial position remaining solid at $2.01 billion. Management also said it expects 2026 net capex at the high end of the $2.0 billion-$2.2 billion range to support growth investments.

STMicroelectronics Trading Down 1.4%

STM opened at $52.73 on Friday. The company has a quick ratio of 2.34, a current ratio of 3.31 and a debt-to-equity ratio of 0.12. The company has a fifty day moving average of $70.32 and a 200-day moving average of $48.42. STMicroelectronics has a twelve month low of $21.11 and a twelve month high of $81.42. The stock has a market cap of $47.36 billion, a PE ratio of 334.36 and a beta of 1.93.

Institutional Inflows and Outflows

Several institutional investors have recently bought and sold shares of STM. Morgan Stanley grew its holdings in STMicroelectronics by 40.6% during the fourth quarter. Morgan Stanley now owns 6,156,161 shares of the semiconductor producer’s stock worth $159,691,000 after buying an additional 1,778,113 shares in the last quarter. Marshall Wace LLP bought a new position in shares of STMicroelectronics during the fourth quarter valued at about $42,731,000. Invesco Ltd. boosted its holdings in STMicroelectronics by 67.1% during the third quarter. Invesco Ltd. now owns 4,003,933 shares of the semiconductor producer’s stock worth $113,151,000 after purchasing an additional 1,608,029 shares during the last quarter. Defiance ETFs LLC bought a new stake in STMicroelectronics in the 4th quarter worth about $39,545,000. Finally, Two Sigma Investments LP increased its stake in STMicroelectronics by 135.0% in the 3rd quarter. Two Sigma Investments LP now owns 2,322,540 shares of the semiconductor producer’s stock valued at $65,635,000 after buying an additional 1,334,192 shares during the last quarter. Institutional investors and hedge funds own 5.05% of the company’s stock.

More STMicroelectronics News

Here are the key news stories impacting STMicroelectronics this week:

• Positive Sentiment: STMicroelectronics beat Q2 estimates, with revenue and EPS both topping forecasts, while management pointed to stronger AI data-center and industrial demand. STMicroelectronics Q2 2026 Earnings Call
• Positive Sentiment: The company raised its long-term AI data-center sales goal again, reinforcing optimism about future growth opportunities. SpaceX Supplier STMicroelectronics Hikes AI Data-Center Sales Goal Again
• Neutral Sentiment: Some analysts say STMicroelectronics may still be fairly valued or below fair value based on its AI revenue ambitions, but the recent pullback has made valuation arguments less clear. STMicroelectronics Stock May Be Below Fair Value On AI Revenue Ambitions
• Negative Sentiment: Near-term sentiment was hurt by soft Q3 revenue guidance, which came in below expectations and raised concern that growth may not accelerate as quickly as investors wanted. STMicro’s Q3 revenue view slightly lags estimates even as chip demand recovers
• Negative Sentiment: Multiple reports said the stock fell sharply after the earnings release because investors focused on the cautious outlook rather than the Q2 beat. STMicroelectronics Sank About 17% After a Soft Q3 Outlook

Wall Street Analyst Weigh In

Several equities analysts recently issued reports on STM shares. TD Cowen reiterated a “hold” rating on shares of STMicroelectronics in a research report on Monday, July 13th. Morgan Stanley reiterated an “overweight” rating on shares of STMicroelectronics in a report on Tuesday, June 30th. Deutsche Bank Aktiengesellschaft reissued a “buy” rating on shares of STMicroelectronics in a report on Thursday, June 11th. Weiss Ratings raised STMicroelectronics from a “sell (d+)” rating to a “hold (c-)” rating in a research note on Tuesday, May 26th. Finally, Citigroup restated a “buy” rating on shares of STMicroelectronics in a research note on Sunday, April 26th. One investment analyst has rated the stock with a Strong Buy rating, eight have issued a Buy rating and four have given a Hold rating to the company’s stock. According to MarketBeat, the stock presently has a consensus rating of “Moderate Buy” and a consensus price target of $69.61.

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.