Oct. 29, 2014, 1:19 PM
- In addition to missing Q3 revenue estimates (while beating on EPS), STMicroelectronics (NYSE:STM) is guiding for Q4 revenue to be down 3.5% Q/Q (+/- 350 bps). That implies a range of $1.76B-$1.89B, well below a $2.01B consensus.
- The company witnessed a "softening of demand towards the end of [Q3], specifically in the mass market and in microcontrollers." Like many other chipmakers, STM was hammered on Oct. 10 after microcontroller vendor Microchip warned.
- All product groups are expected to decline Q/Q except for the Analog, MEMS, and Sensors group, which is benefiting from "key product ramp-ups, such as analog microphones, new 6-axis gyroscopes and touch controllers."
- STM plans to merge its Digital Convergence Group (makes TV/set-top SOCs, among other things) with its Imaging, Bi-CMOS, and Silicon Photonics Group into a new Digital Product Group. The reorg and other initiatives are expected to yield $100M/year in cost savings.
- Between them, the merging units had Q3 revenue of $286M (15% of total revenue). STM appears to be losing set-top chip share to Broadcom.
- Gross margin rose to 34.3% from 34% in Q2 and 32.4% a year ago. Q4 GM guidance is at 33.8% (+/- 200 bps). $93M was spent on buybacks.
- Citi's upgrade wasn't well-timed.
- Q3 results, PR
Oct. 29, 2014, 9:15 AM
Oct. 29, 2014, 5:57 AM
Oct. 28, 2014, 5:30 PM
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Oct. 28, 2014, 10:53 AM
Oct. 13, 2014, 9:58 AM
- Pac Crest has downgraded analog/mixed-signal IC vendors Freescale (FSL -2.9%), ON Semi (ONNN -5.5%), and Silicon Labs (SLAB -3.4%) following Microchip's calendar Q3 warning. In-line with Microchip's cautious remarks, the firm cites evidence of a distributor inventory correction and weak Chinese demand.
- All three names sold off on Friday on account of Microchip, with Freescale and ON registering double-digit declines.
- Meanwhile, JPMorgan has downgraded European chipmakers STMicroelectronics (STM -3.4%) and Infineon (OTCPK:IFNNF) to Neutral. The firm is worried about the impact of German and Chinese macro trends.
Oct. 1, 2014, 9:29 AM
- "We strongly believe investors should look past the unpredictable nature of short-term fearmongers and remain focused on the long-term strategic mileposts that INVN has met," says Needham's Vernon Essi, Jr.
- Essi notes InvenSense was trading at ~$18 a year ago (just a little below current levels), when teardowns revealed its motion sensors weren't in the iPhone 5S. "Fast forward one year and INVN finds itself in the iPhone 6 with upwards of $100M in incremental annual revenue and $0.50 in EPS as a result." His target remains at $28.
- Ascendiant Capital's Cody Acree defended InvenSense yesterday. Like others, the firm argued Apple's inclusion of a Bosch accelerometer in the iPhone 6 (along with an InvenSense gyroscope/accelerometer) was simply done to improve power draw, and isn't a concern.
- Acree does believe traditional motion sensor supplier STMicroelectronics (NYSE:STM) has been qualified as a second source by Apple, but adds it's unknown how much business STM will ultimately get. "Remember, INVN was a second source for the prior iPhone but ended up with little-to-no volume."
- Recent InvenSense coverage
Sep. 22, 2014, 9:33 AM
- Baird has downgraded InvenSense (INVN -4.2%) to Neutral, and lowered its target by $7 to $23. The firm thinks a major smartphone OEM (Apple or Samsung?) could be switching to a dual-source strategy for gyroscopes and other components, and also believes STMicroelectronics (STM -2.9%) could be gaining share at other smartphone OEMs.
- It was only a few days ago that teardowns uncovered a 6-axis InvenSense gyroscope/accelerometer in iPhone 6 models; past iPhone models had relied on STMicro motion sensors.
- Samsung, meanwhile, has relied heavily on InvenSense to date. The electronics giant accounted for 30% of InvenSense's June quarter sales.
Sep. 19, 2014, 9:36 AM
- iFixit's teardown of the iPhone 6 Plus turned up five Qualcomm (NASDAQ:QCOM) chips, up from the three found in last year's teardown of the 5S and nearly matching the six found in certain Galaxy S5 teardowns.
- In addition to the expected Cat-4 LTE baseband modem, a Qualcomm power management IC, RF transceiver, receive-only chip (needed to enable LTE carrier aggregation), and envelope-tracking IC (relatively new, improves battery life) were found in the 6 Plus.
- In-line with rumors and the company's hints, an InvenSense (NYSE:INVN) motion sensor - specifically, a 6-axis gyroscope/accelerometer - was found. That suggests InvenSense has displaced STMicroelectronics (NYSE:STM) as the iPhone's motion sensor supplier.
- Two Skyworks (NASDAQ:SWKS) power amplifier modules are found, including a low-band LTE part. Avago (NASDAQ:AVGO) has both a high-band amplifier module, and an integrated ultra high-band amplifier/FBAR filter module. TriQuint (NASDAQ:TQNT) can claim a 3G amplifier module, and merger partner RF Micro (NASDAQ:RFMD) an antenna switch module.
- Broadcom (NASDAQ:BRCM) appears to remain the iPhone's combo chip supplier (courtesy of a module from partner Murata), and also supplies a touch controller IC. Chipworks thinks Broadcom also has the Wi-Fi slot for the Apple Watch.
- As expected, NXP (NASDAQ:NXPI) is supplying an NFC module and the M8 motion co-processsor, and Cirrus Logic (NASDAQ:CRUS) the audio codec IC. Texas Instruments (NASDAQ:TXN) is providing a touch transmitter IC.
- Moving in response: INVN +1.9%. AVGO +1.5%. STM -3.9%.
Aug. 27, 2014, 11:52 AM
- Credit Suisse has started STMicroelectronics (STM -1%) at Underperform, and European chip peer Infineon (OTCPK:IFNNF +0.7%) at Outperform.
- Bernstein downgraded STM to Underperform a month ago, predicting 2015 revenue growth will be 300 bps below consensus. Shares go for only 0.9x 2015E sales.
- Infineon has rallied since announcing last week it's buying International Rectifier for $3B.
Jul. 29, 2014, 11:05 AM
- "We expect revenue growth 3 pts below consensus next year, driving material earnings misses and forcing management to drop or postpone their 10% operating margin target," writes Bernstein's Pierre Ferragu, while downgrading STMicroelectronics (STM -2.2%) to Underperform.
- Ferragu sees STM's auto, industrial, and microcontroller growth slowing a bit, as 32-bit microcontroller competition grows and auto growth shifts to regions with less chip content per car. Power management chip growth is expected to pick up due to smartphone demand.
- More importantly, he expects STM's digital convergence group (DCG) to grow "well below management's ambitions" due to a long-term decline in set-top chip sales, and predicts the company's MEMS business (hasn't seen growth since 2011) will witness further share losses. He notes Bosch recently won an iPhone MEMS socket at STM's expense.
- STM is a week removed from posting a Q2 revenue miss to go with an EPS beat, and offering below-consensus Q3 guidance.
Jul. 23, 2014, 3:59 PM
- In addition missing Q2 revenue estimates (while beating on EPS), STMicroelectronics (STM) has guided for Q3 revenue to grow 3% Q/Q (+/- 3.5%). That implies revenue of $1.92B at the midpoint, below a $2B consensus.
- Contributing to the EPS beat: Q2 gross margin was 34%, +120 bps Q/Q and Y/Y, and 40 bps above STM's guidance midpoint. GM is expected to come in at 34.4% (+/- 2%) in Q3.
- Automotive IC sales grew 11% Y/Y in Q2 to $463M, but analog/MEMS sales fell 19% to $264M. Industrial & power discrete sales rose 2% to $475M, and microcontroller, memory, & secure MCU sales rose 13% to $396M. Digital convergence group sales tumbled 51% to $184M thanks to the ST-Ericsson wind-down/asset transfer.
- Plenty of other chip stocks are also selling off, with some help from Xilinx and Juniper.
- Q2 results, PR
Jul. 23, 2014, 3:45 AM
Jul. 22, 2014, 5:30 PM
Jul. 15, 2014, 10:17 AM
- OTR Global reports Synaptics (SYNA -5%) has lost the touchscreen controller slot for Samsung's upcoming Galaxy Note 4 to STMicroelectronics (STM -0.6%).
- Synapitcs has the touch controller slot for the Note 3, and both the touch controller and fingerprint sensor slots for the Galaxy S5. High-volume Samsung design wins have contributed heavily to the company's strong mobile growth over the last two years.
Jun. 20, 2014, 12:39 PM
- A 6-axis InvenSense (INVN) motion sensor may have been designed into the iPhone 6, thinks Craig-Hallum, reiterating an Outperform and $22 PT. The firm sees the win providing a $0.25 EPS boost if it happens.
- InvenSense was frequently rumored last year to be the motion sensor supplier for the iPhone 5S/5C, but Apple ultimately went with traditional supplier STMicroelecronics (STM -2%). iPhone 6 sales forecasts are running high, given Apple is expected to finally address pent-up demand for bigger iPhones.
- Meanwhile, Roth thinks InvenSense might have scored multiple design wins for Amazon's Fire phone. In addition to typical motion sensors, the Fire phone has baked optical image stabilization into its 13MP rear camera, and supports 3D viewing with the help of 4 front cameras. Shipments will likely be a small fraction of iPhone levels.
- Previous: InvenSense launches gyroscope for wearables
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STMicroelectronics NV designs, develops, manufactures and markets semiconductor products used in different microelectronic applications, including automotive products, computer peripherals, telecommunications systems, consumer products, & control systems.
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