STMicroelectronics announced its first quarter financial report for 2024, with a net revenue of $3.465 billion, a year-on-year decrease of 18.4% and a month on month decrease of 19.1%; The gross profit was 1.444 billion US dollars, a year-on-year decrease of 31.6%, a month on month decrease of 26%, and a gross profit margin of 41.7%; Net profit was 513 million US dollars, a significant decrease of 50.9% year-on-year and 52.4% month on month.
The slowdown in demand for chips in the automotive industry has resulted in STMicroelectronics's Q1 revenue falling below analyst expectations. The company stated that, considering the weak demand in the automotive industry, it has lowered its 2024 revenue forecast from 15.9 billion to 16.9 billion US dollars to 14 billion to 15 billion US dollars. In addition, it is expected that the gross profit margin will remain at the 40% level.
For several months, STMicroelectronics and the entire chip industry have been working hard to cope with the sluggish demand for consumer electronics due to a slowdown in the smartphone and computer markets. In contrast, the automotive industry has been seeking smaller and more energy-efficient chips, so the automotive semiconductor industry has been very stable. However, this trend is currently undergoing changes.
Jean Marc Chery, President and CEO of STMicroelectronics, stated that the net profit and gross profit in the first quarter were both below the median of the business forecast range, mainly due to a decrease in revenue in the automotive and industrial sectors, but an increase in revenue from personal electronics products offset this impact. Compared to previous expectations, the demand for automotive semiconductors slowed down in the first quarter and entered a deceleration phase.
Looking ahead to the second quarter, STMicroelectronics expects its revenue to be $3.2 billion, a year-on-year decrease of 26.0% and a month on month decrease of 7.6%. In addition, it is expected that the net capital expenditure for the fiscal year 2024 will remain around $2.5 billion.
