STMicroelectronics Reports 2023 Third Quarter Financial Results
PR No: C3210C
STMicroelectronics Reports 2023 Third
Quarter Financial Results
- Q3 net revenues $4.43
billion; gross margin 47.6%; operating margin 28.0%; net income
$1.09 billion
- YTD net revenues $13.00
billion; gross margin 48.7%; operating margin 27.6%; net income
$3.14 billion
- Business outlook at
mid-point: Q4 net revenues of $4.30 billion and gross margin of
46%
Geneva, October 26, 2023 –
STMicroelectronics N.V. (“ST”) (NYSE: STM), a global
semiconductor leader serving customers across the spectrum of
electronics applications, reported U.S. GAAP financial results for
the third quarter ended September 30, 2023. This press release also
contains non-U.S. GAAP measures (see Appendix for additional
information).
ST reported third quarter net revenues of $4.43
billion, gross margin of 47.6%, operating margin of 28.0%, and net
income of $1.09 billion or $1.16 diluted earnings per share.
Jean-Marc Chery, ST President & CEO,
commented:
- “Q3 net revenues of
$4.43 billion came in above the
midpoint of our business outlook range, and Q3 gross margin
of 47.6% was slightly above
guidance.”
- “Q3 net revenues
increased 2.5% year-over-year. As
expected, the revenue performance was driven mainly by continued
growth in Automotive, partially offset by lower revenues in
Personal Electronics.”
- “On a year-over-year basis,
gross margin remained stable at
47.6%, while, as expected, operating
margin decreased to 28.0% from
29.4% and net income was stable at $1.09
billion.”
- “First nine months net
revenues increased 11.1%
year-over-year, driven by growth in ADG and MDG Product Groups,
partially offset by a decline of AMS Product Group. Operating
margin was 27.6% and net income
was $3.14 billion.”
- “Our fourth quarter
business outlook, at the mid-point, is for net revenues of
$4.30 billion, declining
year-over-year and sequentially by about 3%; gross margin is
expected to be about
46%.”
- “The midpoint of this
outlook translates into full year 2023 revenues of about
$17.3 billion, representing 7.3%
year-over-year growth and a gross margin of about
48.1%.”
Quarterly Financial Summary (U.S. GAAP)
(US$ m, except per share data) |
Q3 2023 |
Q2 2023 |
Q3 2022 |
Q/Q |
Y/Y |
Net Revenues |
$4,431 |
$4,326 |
$4,321 |
2.4% |
2.5% |
Gross Profit |
$2,109 |
$2,119 |
$2,059 |
-0.5% |
2.4% |
Gross Margin |
47.6% |
49.0% |
47.6% |
-140 bps |
- |
Operating Income |
$1,241 |
$1,146 |
$1,272 |
8.2% |
-2.4% |
Operating Margin |
28.0% |
26.5% |
29.4% |
150 bps |
-140 bps |
Net Income |
$1,090 |
$1,001 |
$1,099 |
8.9% |
-0.8% |
Diluted Earnings Per Share |
$1.16 |
$1.06 |
$1.16 |
9.4% |
- |
Third Quarter 2023 Summary Review
Net Revenues By Product Group (US$ m) |
Q3 2023 |
Q2 2023 |
Q3 2022 |
Q/Q |
Y/Y |
Automotive and Discrete Group (ADG) |
2,025 |
1,955 |
1,563 |
3.6% |
29.6% |
Analog, MEMS and Sensors Group (AMS) |
990 |
940 |
1,380 |
5.3% |
-28.3% |
Microcontrollers and Digital ICs Group (MDG) |
1,412 |
1,427 |
1,374 |
-1.0% |
2.8% |
Others |
4 |
4 |
4 |
- |
- |
Total Net Revenues |
4,431 |
4,326 |
4,321 |
2.4% |
2.5% |
Net revenues totaled $4.43
billion, representing a year-over-year increase of 2.5%. On a
year-over-year basis, ADG and MDG revenues increased 29.6% and 2.8%
respectively, while AMS decreased 28.3%. Year-over-year net sales
to OEMs and Distribution increased 2.1% and 3.4%, respectively. On
a sequential basis, net revenues increased 2.4%, 130 basis points
better than the mid-point of ST’s guidance. ADG and AMS both
reported an increase in net revenues on a sequential basis, and MDG
slightly decreased, as expected.
Gross profit totaled $2.11
billion, representing a year-over-year increase of 2.4%.
Gross margin of 47.6% was stable year-over-year,
as improved product mix was offset by higher manufacturing costs
and unused capacity charges.
Operating income decreased 2.4%
to $1.24 billion, compared to $1.27 billion in the year-ago
quarter. ST’s operating margin decreased 140 basis
points on a year-over-year basis to 28.0% of net revenues, compared
to 29.4% in the 2022 third quarter.
By product group, compared with
the year-ago quarter:
Automotive and Discrete Group (ADG):
- Revenue increased for both
Automotive and Power Discrete.
- Operating profit increased by 57.9%
to $638 million. Operating margin was 31.5% compared to
25.9%.
Analog, MEMS and Sensors Group (AMS):
- Revenue decreased in Analog, in
Imaging and in MEMS.
- Operating profit decreased by 50.6%
to $186 million. Operating margin was 18.8% compared to 27.2%.
Microcontrollers and Digital ICs Group
(MDG):
- Revenue increased for RF
Communications while Microcontrollers were stable.
- Operating profit decreased by 1.6%
to $496 million. Operating margin was 35.1% compared to 36.7%.
Net income was stable at $1.09
billion compared to $1.10 billion in the year-ago quarter, and
diluted earnings per share remained stable at
$1.16.
Cash Flow and Balance Sheet Highlights
|
|
|
|
Trailing 12 Months |
(US$ m) |
Q3 2023 |
Q2 2023 |
Q3 2022 |
Q3 2023 |
Q3 2022 |
TTM Change |
Net cash from operating activities |
1,881 |
1,311 |
1,651 |
6,062 |
4,533 |
33.7% |
Free cash flow (non-U.S. GAAP)1 |
707 |
209 |
676 |
1,725 |
1,302 |
32.5% |
Net cash from operating activities was $1.88
billion in the third quarter compared to $1.65 billion in the
year-ago quarter.
Capital expenditure payments, net of proceeds
from sales, capital grants and other contributions, were $1.15
billion in the third quarter. In the year-ago period, capital
expenditures, net, were $0.96 billion.
Free cash flow (non-U.S. GAAP) was $707 million
compared to $676 million in the year-ago quarter.
Inventory at the end of the third quarter was
$2.87 billion, compared to $2.38 billion in the year-ago quarter.
Days sales of inventory at quarter-end was 114 days compared to 126
days in the previous quarter and 96 days in the year-ago
quarter.
In the third quarter, ST paid cash dividends to
its stockholders totaling $58 million and executed a $87 million
share buy-back as part of its current share repurchase program.
ST’s net financial position (non-U.S. GAAP) was
$2.46 billion as of September 30, 2023, compared to $1.91 billion
as of July 1, 2023 and reflected total liquidity of $5.05 billion
and total financial debt of $2.59 billion.
Corporate developments
On September 19, 2023, the ST Supervisory Board
announced that it would propose for shareholder approval at ST’s
2024 Annual General Meeting of Shareholders, the reappointment of
Jean-Marc Chery for a three-year mandate as the sole member of the
Company’s Managing Board and its President and Chief Executive
Officer, and that Mr. Chery had accepted the proposal.
Business Outlook
ST’s guidance, at the mid-point, for the 2023
fourth quarter is:
- Net revenues are expected to be
$4.30 billion, a decrease of about 3% sequentially, plus or minus
350 basis points.
- Gross margin of 46%, plus or minus
200 basis points.
- This outlook is based on an assumed
effective currency exchange rate of approximately $1.08 = €1.00 for
the 2023 fourth quarter and includes the impact of existing hedging
contracts.
- The fourth quarter will close on
December 31, 2023.
Conference Call and Webcast Information
ST will conduct a conference call with analysts,
investors and reporters to discuss its third quarter 2023 financial
results and current business outlook today at 9:30 a.m. Central
European Time (CET) / 3:30 a.m. U.S. Eastern Time (ET). A live
webcast (listen-only mode) of the conference call will be
accessible at ST’s website, https://investors.st.com, and will be
available for replay until November 10, 2023.
Use of Supplemental Non-U.S. GAAP Financial
Information
This press release contains supplemental
non-U.S. GAAP financial information.
Readers are cautioned that these measures are
unaudited and not prepared in accordance with U.S. GAAP and should
not be considered as a substitute for U.S. GAAP financial measures.
In addition, such non-U.S. GAAP financial measures may not be
comparable to similarly titled information from other companies. To
compensate for these limitations, the supplemental non-U.S. GAAP
financial information should not be read in isolation, but only in
conjunction with ST’s consolidated financial statements prepared in
accordance with U.S. GAAP.
See the Appendix of this press release for a
reconciliation of ST’s non-U.S. GAAP financial measures to their
corresponding U.S. GAAP financial measures.
Forward-looking Information
Some of the statements contained in this release
that are not historical facts are statements of future expectations
and other forward-looking statements (within the meaning of Section
27A of the Securities Act of 1933 or Section 21E of the Securities
Exchange Act of 1934, each as amended) that are based on
management’s current views and assumptions, and are conditioned
upon and also involve known and unknown risks and uncertainties
that could cause actual results, performance, or events to differ
materially from those anticipated by such statements, due to, among
other factors:
- changes in global trade policies,
including the adoption and expansion of tariffs and trade barriers,
that could affect the macro-economic environment and adversely
impact the demand for our products;
- uncertain macro-economic and
industry trends (such as inflation and fluctuations in supply
chains), which may impact production capacity and end-market demand
for our products;
- customer demand that differs from
projections;
- the ability to design, manufacture
and sell innovative products in a rapidly changing technological
environment;
- changes in economic, social, public
health, labor, political, or infrastructure conditions in the
locations where we, our customers, or our suppliers operate,
including as a result of macroeconomic or regional events,
geopolitical and military conflicts (including the ongoing conflict
between Russia and Ukraine), social unrest, labor actions, or
terrorist activities;
- unanticipated events or
circumstances, which may impact our ability to execute our plans
and/or meet the objectives of our R&D and manufacturing
programs, which benefit from public funding;
- financial difficulties with any of
our major distributors or significant curtailment of purchases by
key customers;
- the loading, product mix, and
manufacturing performance of our production facilities and/or our
required volume to fulfill capacity reserved with suppliers or
third-party manufacturing providers;
- availability and costs of
equipment, raw materials, utilities, third-party manufacturing
services and technology, or other supplies required by our
operations (including increasing costs resulting from
inflation);
- the functionalities and performance
of our information technology (“IT”) systems, which are subject to
cybersecurity threats and which support our critical operational
activities including manufacturing, finance and sales, and any
breaches of our IT systems or those of our customers, suppliers,
partners and providers of third-party licensed technology;
- theft, loss, or misuse of personal
data about our employees, customers, or other third parties, and
breaches of data privacy legislation;
- the impact of intellectual property
claims by our competitors or other third parties, and our ability
to obtain required licenses on reasonable terms and
conditions;
- changes in our overall tax position
as a result of changes in tax rules, new or revised legislation,
the outcome of tax audits or changes in international tax treaties
which may impact our results of operations as well as our ability
to accurately estimate tax credits, benefits, deductions and
provisions and to realize deferred tax assets;
- variations in the foreign exchange
markets and, more particularly, the U.S. dollar exchange rate as
compared to the Euro and the other major currencies we use for our
operations;
- the outcome of ongoing litigation
as well as the impact of any new litigation to which we may become
a defendant;
- product liability or warranty
claims, claims based on epidemic or delivery failure, or other
claims relating to our products, or recalls by our customers for
products containing our parts;
- natural events such as severe
weather, earthquakes, tsunamis, volcano eruptions or other acts of
nature, the effects of climate change, health risks and epidemics
or pandemics such as the COVID-19 pandemic in locations where we,
our customers or our suppliers operate;
- increased regulation and
initiatives in our industry, including those concerning climate
change and sustainability matters and our goal to become carbon
neutral on scope 1 and 2 and partially scope 3 by 2027;
- potential loss of key employees and
potential inability to recruit and retain qualified employees as a
result of epidemics or pandemics such as the COVID-19 pandemic,
remote-working arrangements and the corresponding limitation on
social and professional interaction;
- the duration and the severity of
the global outbreak of COVID-19 may continue to negatively impact
the global economy in a significant manner for an extended period
of time, and also could materially adversely affect our business
and operating results;
- industry changes resulting from
vertical and horizontal consolidation among our suppliers,
competitors, and customers; and
- the ability to successfully ramp up
new programs that could be impacted by factors beyond our control,
including the availability of critical third-party components and
performance of subcontractors in line with our expectations.
Such forward-looking statements are subject to
various risks and uncertainties, which may cause actual results and
performance of our business to differ materially and adversely from
the forward-looking statements. Certain forward-looking statements
can be identified by the use of forward looking terminology, such
as “believes,” “expects,” “may,” “are expected to,” “should,”
“would be,” “seeks” or “anticipates” or similar expressions or the
negative thereof or other variations thereof or comparable
terminology, or by discussions of strategy, plans or
intentions.
Some of these risks are set forth and are
discussed in more detail in “Item 3. Key Information — Risk
Factors” included in our Annual Report on Form 20-F for the year
ended December 31, 2022 as filed with the Securities and Exchange
Commission (“SEC”) on February 23, 2023. Should one or more of
these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may vary materially
from those described in this press release as anticipated,
believed, or expected. We do not intend, and do not assume any
obligation, to update any industry information or forward-looking
statements set forth in this release to reflect subsequent events
or circumstances.
Unfavorable changes in the above or other risks
or uncertainties listed under “Item 3. Key Information — Risk
Factors” from time to time in our SEC filings, could have a
material adverse effect on our business and/or financial
condition.
About STMicroelectronics
At ST, we are over 50,000 creators and makers of
semiconductor technologies mastering the semiconductor supply chain
with state-of-the-art manufacturing facilities. An integrated
device manufacturer, we work with more than 200,000 customers and
thousands of partners to design and build products, solutions, and
ecosystems that address their challenges and opportunities, and the
need to support a more sustainable world. Our technologies enable
smarter mobility, more efficient power and energy management, and
the wide-scale deployment of the Internet of Things and
connectivity. We are committed to achieving our goal to become
carbon neutral on scope 1 and 2 and partially scope 3 by 2027.
Further information can be found at www.st.com.
For further information, please contact:
INVESTOR RELATIONS:Céline BerthierGroup VP,
Investor RelationsTel: +41 22 929 58 12celine.berthier@st.com
MEDIA RELATIONS:Alexis BretonCorporate External
CommunicationsTel: + 33 6 59 16 79 08alexis.breton@st.com
STMicroelectronics N.V. |
|
|
|
CONSOLIDATED STATEMENTS OF INCOME |
|
|
|
(in millions of U.S. dollars, except per share data
($)) |
|
|
|
|
|
|
|
|
Three months ended |
|
|
September 30, |
October 1, |
|
|
2023 |
2022 |
|
|
(Unaudited) |
(Unaudited) |
|
|
|
|
|
Net sales |
4,416 |
4,305 |
|
Other revenues |
15 |
16 |
|
NET REVENUES |
4,431 |
4,321 |
|
Cost of sales |
(2,322) |
(2,262) |
|
GROSS PROFIT |
2,109 |
2,059 |
|
Selling, general and administrative |
(407) |
(352) |
|
Research and development |
(519) |
(463) |
|
Other income and expenses, net |
58 |
28 |
|
Total operating expenses |
(868) |
(787) |
|
OPERATING INCOME |
1,241 |
1,272 |
|
Interest income, net |
44 |
16 |
|
Other components of pension benefit costs |
(5) |
(2) |
|
INCOME BEFORE INCOME TAXES AND NONCONTROLLING
INTEREST |
1,280 |
1,286 |
|
Income tax expense |
(188) |
(185) |
|
NET INCOME |
1,092 |
1,101 |
|
Net income attributable to noncontrolling interest |
(2) |
(2) |
|
NET INCOME ATTRIBUTABLE TO PARENT COMPANY
STOCKHOLDERS |
1,090 |
1,099 |
|
|
|
|
|
EARNINGS PER SHARE (BASIC) ATTRIBUTABLE TO PARENT COMPANY
STOCKHOLDERS |
1.20 |
1.21 |
|
EARNINGS PER SHARE (DILUTED) ATTRIBUTABLE TO PARENT COMPANY
STOCKHOLDERS |
1.16 |
1.16 |
|
|
|
|
|
NUMBER OF WEIGHTED AVERAGE SHARES USED IN CALCULATING
DILUTED EPS |
943.8 |
945.5 |
|
|
|
|
|
STMicroelectronics N.V. |
|
|
|
CONSOLIDATED STATEMENTS OF INCOME |
|
|
|
(in millions of U.S. dollars, except per share data
($)) |
|
|
|
|
Nine months ended |
|
|
|
|
September 30, |
October 1, |
|
|
2023 |
2022 |
|
|
(Unaudited) |
(Unaudited) |
|
|
|
|
|
Net sales |
12,977 |
11,675 |
|
Other revenues |
27 |
29 |
|
NET REVENUES |
13,004 |
11,704 |
|
Cost of sales |
(6,666) |
(6,171) |
|
GROSS PROFIT |
6,338 |
5,533 |
|
Selling, general and administrative |
(1,215) |
(1,076) |
|
Research and development |
(1,579) |
(1,429) |
|
Other income and expenses, net |
44 |
125 |
|
Total operating expenses |
(2,750) |
(2,380) |
|
OPERATING INCOME |
3,588 |
3,153 |
|
Interest income, net |
114 |
24 |
|
Other components of pension benefit costs |
(14) |
(7) |
|
INCOME BEFORE INCOME TAXES AND NONCONTROLLING
INTEREST |
3,688 |
3,170 |
|
Income tax expense |
(547) |
(454) |
|
NET INCOME |
3,141 |
2,716 |
|
Net income attributable to noncontrolling interest |
(6) |
(3) |
|
NET INCOME ATTRIBUTABLE TO PARENT COMPANY
STOCKHOLDERS |
3,135 |
2,713 |
|
|
|
|
|
EARNINGS PER SHARE (BASIC) ATTRIBUTABLE TO PARENT COMPANY
STOCKHOLDERS |
3.47 |
2.99 |
|
EARNINGS PER SHARE (DILUTED) ATTRIBUTABLE TO PARENT COMPANY
STOCKHOLDERS |
3.32 |
2.87 |
|
|
|
|
|
NUMBER OF WEIGHTED AVERAGE SHARES USED IN CALCULATING
DILUTED EPS |
944.7 |
946.9 |
|
|
|
|
|
|
|
|
|
STMicroelectronics N.V. |
|
|
|
CONSOLIDATED BALANCE SHEETS |
|
|
|
As at |
September 30, |
July 1, |
December 31, |
In millions of U.S. dollars |
2023 |
2023 |
2022 |
|
(Unaudited) |
(Unaudited) |
(Audited) |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
3,011 |
3,111 |
3,258 |
Short-term deposits |
506 |
106 |
581 |
Marketable securities |
1,537 |
1,346 |
679 |
Trade accounts receivable, net |
1,837 |
1,984 |
1,970 |
Inventories |
2,870 |
3,045 |
2,583 |
Other current assets |
1,230 |
1,215 |
734 |
Total current assets |
10,991 |
10,807 |
9,805 |
Goodwill |
294 |
297 |
297 |
Other intangible assets, net |
353 |
356 |
405 |
Property, plant and equipment, net |
9,672 |
9,303 |
8,201 |
Non-current deferred tax assets |
510 |
545 |
602 |
Long-term investments |
21 |
21 |
11 |
Other non-current assets |
721 |
572 |
661 |
|
11,571 |
11,094 |
10,177 |
Total assets |
22,562 |
21,901 |
19,982 |
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
Current liabilities: |
|
|
|
Short-term debt |
173 |
176 |
175 |
Trade accounts payable |
1,555 |
1,990 |
2,122 |
Other payables and accrued liabilities |
1,517 |
1,454 |
1,385 |
Dividends payable to stockholders |
115 |
173 |
60 |
Accrued income tax |
377 |
248 |
95 |
Total current liabilities |
3,737 |
4,041 |
3,837 |
Long-term debt |
2,418 |
2,473 |
2,542 |
Post-employment benefit obligations |
338 |
340 |
331 |
Long-term deferred tax liabilities |
55 |
56 |
60 |
Other long-term liabilities |
507 |
418 |
454 |
|
3,318 |
3,287 |
3,387 |
Total liabilities |
7,055 |
7,328 |
7,224 |
Commitment and contingencies |
|
|
|
Equity |
|
|
|
Parent company stockholders' equity |
|
|
|
Common stock (preferred stock: 540,000,000 shares authorized, not
issued; common stock: Euro 1.04 nominal value, 1,200,000,000 shares
authorized, 911,281,920 shares issued, 904,706,324 shares
outstanding as of September 30, 2023) |
1,157 |
1,157 |
1,157 |
Additional Paid-in Capital |
2,800 |
2,743 |
2,631 |
Retained earnings |
11,395 |
10,340 |
8,713 |
Accumulated other comprehensive income |
376 |
505 |
460 |
Treasury stock |
(293) |
(241) |
(268) |
Total parent company stockholders' equity |
15,435 |
14,504 |
12,693 |
Noncontrolling interest |
72 |
69 |
65 |
Total equity |
15,507 |
14,573 |
12,758 |
Total liabilities and equity |
22,562 |
21,901 |
19,982 |
|
|
|
|
|
|
|
|
|
|
|
|
STMicroelectronics N.V. |
|
|
|
|
|
|
|
SELECTED CASH FLOW DATA |
|
|
|
|
|
|
|
Cash Flow Data (in US$ millions) |
Q3 2023 |
Q2 2023 |
Q3 2022 |
|
|
|
|
Net Cash from operating activities |
1,881 |
1,311 |
1,651 |
Net Cash used in investing activities |
(1,756) |
(1,615) |
(1,851) |
Net Cash used in financing activities |
(223) |
(158) |
(5) |
Net Cash decrease |
(100) |
(461) |
(216) |
|
|
|
|
Selected Cash Flow Data (in US$ millions) |
Q3 2023 |
Q2 2023 |
Q3 2022 |
|
|
|
|
Depreciation & amortization |
396 |
383 |
312 |
Net payment for Capital expenditures |
(1,152) |
(1,072) |
(955) |
Dividends paid to stockholders |
(58) |
(50) |
(55) |
Change in inventories, net |
147 |
(175) |
(126) |
AppendixSTSupplemental
Financial Information
(a) Net revenues of Others include
revenues from sales assembly services and other revenues. Operating
income (loss) of Others includes items such as unused capacity
charges, including reduced manufacturing activity due to COVID-19
and incidents leading to power outage, impairment, restructuring
charges and other related closure costs, management reorganization
costs, start-up and phase-out costs of certain manufacturing
facilities, and other unallocated income (expenses) such as:
strategic or special research and development programs, certain
corporate-level operating expenses, patent claims and litigations,
and other costs that are not allocated to product groups, as well
as operating earnings of other products. Others includes:
|
Q3 2023 |
Q2 2023 |
Q1 2023 |
Q4 2022 |
Q3 2022 |
Net Revenues By Market Channel
(%) |
|
|
|
|
|
Total OEM |
67% |
64% |
64% |
68% |
67% |
Distribution |
33% |
36% |
36% |
32% |
33% |
|
|
|
|
|
|
€/$ Effective Rate |
1.09 |
1.08 |
1.06 |
1.04 |
1.08 |
|
|
|
|
|
|
Product Group Data (US$ m) |
|
|
|
|
|
Automotive & Discrete Group (ADG) |
|
|
|
|
|
- Net Revenues |
2,025 |
1,955 |
1,807 |
1,696 |
1,563 |
- Operating Income |
638 |
624 |
577 |
470 |
404 |
Analog, MEMS & Sensors Group (AMS) |
|
|
|
|
|
- Net Revenues |
990 |
940 |
1,068 |
1,339 |
1,380 |
- Operating Income |
186 |
139 |
218 |
346 |
376 |
Microcontrollers & Digital ICs Group
(MDG) |
|
|
|
|
|
- Net Revenues |
1,412 |
1,427 |
1,368 |
1,383 |
1,374 |
- Operating Income |
496 |
505 |
495 |
495 |
504 |
Others (a) |
|
|
|
|
|
- Net Revenues |
4 |
4 |
4 |
6 |
4 |
- Operating Income (Loss) |
(79) |
(122) |
(89) |
(24) |
(12) |
Total |
|
|
|
|
|
- Net Revenues |
4,431 |
4,326 |
4,247 |
4,424 |
4,321 |
- Operating Income |
1,241 |
1,146 |
1,201 |
1,287 |
1,272 |
(US$ m) |
Q3 2023 |
Q2 2023 |
Q1 2023 |
Q4 2022 |
Q3 2022 |
Unused capacity charges |
46 |
15 |
1 |
- |
- |
(Appendix –
continued)STSupplemental Non-U.S.
GAAP Financial InformationU. S. GAAP – Non-U.S.
GAAP Reconciliation
The supplemental non-U.S. GAAP information
presented in this press release is unaudited and subject to
inherent limitations. Such non-U.S. GAAP information is not based
on any comprehensive set of accounting rules or principles and
should not be considered as a substitute for U.S. GAAP
measurements. Also, our supplemental non-U.S. GAAP financial
information may not be comparable to similarly titled non-U.S. GAAP
measures used by other companies. Further, specific limitations for
individual non-U.S. GAAP measures, and the reasons for presenting
non-U.S. GAAP financial information, are set forth in the
paragraphs below. To compensate for these limitations, the
supplemental non-U.S. GAAP financial information should not be read
in isolation, but only in conjunction with our consolidated
financial statements prepared in accordance with U.S. GAAP.
ST believes that these non-U.S. GAAP financial
measures provide useful information for investors and management
because they offer, when read in conjunction with ST’s U.S. GAAP
financials, (i) the ability to make more meaningful
period-to-period comparisons of ST’s on-going operating results,
(ii) the ability to better identify trends in ST’s business
and perform related trend analysis, and (iii) to facilitate a
comparison of ST’s results of operations against investor and
analyst financial models and valuations, which may exclude these
items.
Net Financial Position (non-U.S. GAAP
measure)
Net Financial Position, a non-U.S. GAAP measure,
represents the difference between our total liquidity and our total
financial debt. Our total liquidity includes cash and cash
equivalents, restricted cash, if any, short-term deposits, and
marketable securities, and our total financial debt includes
short-term debt and long-term debt, as reported in our Consolidated
Balance Sheets.
ST believes our Net Financial Position provides
useful information for investors and management because it gives
evidence of our global position either in terms of net indebtedness
or net cash by measuring our capital resources based on cash and
cash equivalents, restricted cash, if any, short-term deposits and
marketable securities and the total level of our financial debt.
Our definition of Net Financial Position may differ from
definitions used by other companies, and therefore, comparability
may be limited.
(US$ m) |
Sep 30 2023 |
July 1 2023 |
Apr 1 2023 |
Dec 31 2022 |
Oct 1 2022 |
Cash and cash equivalents |
3,011 |
3,111 |
3,572 |
3,258 |
2,812 |
Short term deposits |
506 |
106 |
106 |
581 |
780 |
Marketable securities |
1,537 |
1,346 |
841 |
679 |
496 |
Total liquidity |
5,054 |
4,563 |
4,519 |
4,518 |
4,088 |
Short-term debt |
(173) |
(176) |
(176) |
(175) |
(155) |
Long-term debt (a) |
(2,418) |
(2,473) |
(2,488) |
(2,542) |
(2,476) |
Total financial debt |
(2,591) |
(2,649) |
(2,664) |
(2,717) |
(2,631) |
Net Financial Position |
2,463 |
1,914 |
1,855 |
1,801 |
1,457 |
(a) Long-term debt contains standard conditions but
does not impose minimum financial ratios. Committed credit
facilities for $1.3 billion equivalent, are currently undrawn.
(Appendix –
continued)ST
Free Cash Flow (non-U.S. GAAP
measure)
Free Cash Flow, which is a non-U.S. GAAP
measure, is defined as (i) net cash from operating activities plus
(ii) net cash used in investing activities, excluding payment for
purchases of (and proceeds from matured) marketable securities and
net investment in (and proceeds from) short-term deposits, which
are considered as temporary financial investments. This definition
ultimately results in net cash from operating activities plus
payment for purchase (and proceeds from sale) of tangible,
intangible and financial assets, proceeds from capital grants and
other contributions, and net cash paid for business acquisitions,
if any.
ST believes Free Cash Flow provides useful
information for investors and management because it measures our
capacity to generate cash from our operating and investing
activities to sustain our operations. Free Cash Flow does not
represent total cash flow since it does not include the cash flows
from, or used in, financing activities.
Free Cash Flow reconciles with the total cash
flow and the net cash increase (decrease) by including the payment
for purchases of (and proceeds from matured) marketable securities
and net investment in (and proceeds from) short-term deposits, the
net cash from (used in) financing activities and the effect of
changes in exchange rates. Our definition of Free Cash Flow may
differ from definitions used by other companies.
(US$ m) |
Q3 2023 |
Q2 2023 |
Q1 2023 |
Q4 2022 |
Q3 2022 |
Net cash from operating activities |
1,881 |
1,311 |
1,320 |
1,550 |
1,651 |
Payment for purchase of tangible assets, net of proceeds from sale
and proceeds from capital grants and other contributions |
(1,152) |
(1,072) |
(1,090) |
(920) |
(955) |
Payment for purchase of intangible assets, net of proceeds from
sale |
(22) |
(22) |
(24) |
(27) |
(20) |
Payment for purchase of financial assets, net of proceeds from
sale |
- |
(8) |
- |
- |
- |
Free Cash Flow (a) |
707 |
209 |
206 |
603 |
676 |
(a) Free Cash Flow can also be expressed as net cash from
operating and investing activities, excluding cash from (used in)
marketable securities and short-term deposits.
1 Non-U.S. GAAP. See Appendix for reconciliation to U.S. GAAP
and information explaining why ST believes these measures are
important.
- C3210C - ST Q323 Earnings PR 26 oct 2023
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