STMicroelectronics (STM.US) reiterates its 2030 financial targets, expecting cost-saving plans to support mid-term performance
1min read STMicroelectronics (STM.US) on Wednesday maintained its 2030 financial targets set in 2022, despite three downgrades of its annual revenue expectations this year due to the weak industrial and automotive chip markets. The company reiterated its expectation that revenue would reach $20 billion and operating margin would exceed 30% by 2030. It also set a medium-term plan for 2027-2028, aiming to achieve $18 billion in revenue and an operating margin of 22%-24% with the support of cost-saving programs. The company said in a statement: "It is expected to save millions of dollars compared to the current cost base by 2027."
STMicroelectronics reported a Q3 revenue of $3.25 billion, down 27% YoY, and a net profit of $351 million, down 67.8% YoY in its earnings released at the end of October. The company's Q3 revenue decline was due to its automotive customers facing deteriorating headwinds. The company said its full-year revenue in 2024 would be about $13.27 billion, down 23% YoY, which was its third downgrade of its annual revenue expectations this year.
Moreover, STMicroelectronics said in its Q3 earnings that it would launch a company-wide program to reshape its manufacturing business, but did not elaborate on where the savings would come from. Investors and analysts are expected to learn some details of the plan at the company's investor day event on Wednesday.