STMicroelectronics 2Q Net Profit Climbed; Raises 2021 Targets Amid High Chip Demand

   By Mauro Orru 
 

STMicroelectronics NV said Thursday that net profit and revenue surged in the second quarter and raised its targets for the year, banking on high chip demand as a global supply shortage continues.

The European chip maker said net profit rose to $412 million from $90 million in the second quarter of 2020.

Net revenue increased to $2.99 billion from $2.09 billion, it said.

Gross profit climbed to $1.21 billion from $730 million with a gross margin of 40.5%, while operating income rose to $489 million from $106 million with an operating margin of 16.3%.

STMicroelectronics had expected second-quarter net revenue of $2.9 billion at the midpoint, with a gross margin of about 39.5%.

For the third quarter, the company targets net revenue of $3.20 billion at the midpoint, and a with a gross margin of about 41%.

The company is raising its targets for the year, now expecting revenue of $12.5 billion, plus or minus $100 million. It previously expected revenue of $12.1 billion, plus or minus $150 million.

Capital expenditure for 2021 should amount to about $2.1 billion, instead of around $2 billion as previously targeted, it said.

"This growth is expected to be driven by strong dynamics in all the end markets we address and our engaged customer programs," Chief Executive Jean-Marc Chery said.

Write to Mauro Orru at [e-mail]; @MauroOrru94

(END) Dow Jones Newswires

July 29, 2021 01:38 ET (05:38 GMT)

Copyright (c) 2021 Dow Jones & Company, Inc.