STMicro Expects Sales Growth in Q2 After Hitting Low in Q1 FY25

STMicroelectronics, one of Europe’s major chipmakers, has forecast improved sales in the second quarter of FY25 after a weak start to the year. The company reported first-quarter revenue of $2.52 billion, in line with its earlier forecast. Despite a steep 99.5% year-on-year drop in operating income due to a prolonged slowdown in automotive and industrial chip demand, the company believes the worst is now behind.

For the second quarter, STMicro expects revenue of $2.71 billion—still 16.2% lower than last year but ahead of analysts’ expectations of $2.62 billion. This outlook excludes potential effects from global trade tariff changes.

CEO Jean-Marc Chery emphasized that the company remains focused on innovation and improving its product portfolio to stay competitive amid economic uncertainty. However, STMicro has not provided a full-year revenue guidance, citing ongoing market unpredictability and customer inventory corrections.

Inventories continued to rise, reaching 167 days of sales compared to 122 days in the previous quarter. Despite this, analysts see early signs of a cyclical recovery in the sector. On a positive note, U.S. chipmaker Texas Instruments also forecast a Q2 rebound, suggesting broader improvement across the global chip industry.

Source: The Economic Times