- Q2 net revenues $2.77 billion; gross margin 33.5%; operating loss of $133 million, including $190 million related to impairment, restructuring charges and other related phase-out costs; net loss of $97 million
- H1 net revenues $5.28 billion; gross margin 33.5%; operating loss of $130 million, including $198 million related to impairment, restructuring charges and other related phase-out costs; net loss of $41 million
- Business outlook at mid-point: Q3 net revenues of $3.17 billion and gross margin of 33.5%
Geneva – STMicroelectronics a global semiconductor leader serving customers across the spectrum of electronics applications, reported U.S. GAAP financial results for the second quarter ended June 28, 2025. This press release also contains non-U.S. GAAP measures (see Appendix for additional information).
ST reported second quarter net revenues of $2.77 billion, gross margin of 33.5%, operating loss of $133 million, and net loss of $97 million or -$0.11 diluted earnings per share (non-U.S. GAAP operating income of $57 million, and non-U.S. GAAP1 net income of $57 million or $0.06 diluted earnings per share).
Jean-Marc Chery, ST President & CEO, commented:
- “Q2 net revenues came above the mid-point of our business outlook range, driven by higher revenues in Personal Electronics and Industrial, while Automotive was slightly below expectations. Gross margin was in line with the mid-point of our business outlook range.”
- “On a year-over-year basis, Q2 net revenues decreased 14.4%, non-U.S. GAAP1 operating margin decreased to 2.1% from 11.6% and non-U.S. GAAP1 net income decreased to $57 million from $353 million.”
- “First half net revenues decreased 21.1% year-over-year, with a decrease in all reportable segments. Non-U.S. GAAP1 operating margin was 1.3% and non-U.S. GAAP1 net income was $120 million.”
- “In the second quarter, our book-to-bill ratio remained above one for Industrial, while Automotive was below parity. Bookings continued to increase sequentially.”
- “Our third quarter business outlook, at the mid-point, is for net revenues of $3.17 billion, decreasing year-over-year by 2.5% and increasing sequentially by 14.6%; gross margin is expected to be about 33.5%; including about 340 basis points of unused capacity charges. On a sequential basis, our Q3 gross margin will be negatively impacted by about 140 basis points, mainly from currency effect and, to a lesser extent, the start of non-recurring cost related to our manufacturing reshaping program.”
- “While we expect Q3 revenues to show a solid sequential growth enabling a continued year-over-year improvement, we are still operating amid an uncertain macroeconomic environment. Given these external factors, our priorities remain supporting our customers, accelerating new product introductions, and executing our company-wide program to reshape our manufacturing footprint and resize our global cost base.”
Quarterly Financial Summary
| U.S. GAAP(US$ m, except per share data) | Q2 2025 | Q1 2025 | Q2 2024 | Q/Q | Y/Y |
| Net Revenues | $2,766 | $2,517 | $3,232 | 9.9% | -14.4% |
| Gross Profit | $926 | $841 | $1,296 | 10.2% | -28.5% |
| Gross Margin | 33.5% | 33.4% | 40.1% | +10 bps | – 660 bps |
| Operating Income (Loss) | $(133) | $3 | $375 | – | – |
| Operating Margin | -4.8% | 0.1% | 11.6% | -490 bps | -1,640 bps |
| Net Income (Loss) | $(97) | $56 | $353 | – | – |
| Diluted Earnings Per Share | $(0.11) | $0.06 | $0.38 | – | – |
| Non-U.S. GAAP2(US$ m, except per share data) | Q2 2025 | Q1 2025 | Q2 2024 | Q/Q | Y/Y |
| Operating Income | $57 | $11 | $375 | 429.6% | -84.7% |
| Operating Margin | 2.1% | 0.4% | 11.6% | 170 bps | -950 bps |
| Net Income | $57 | $63 | $353 | -9.1% | -83.9% |
| Diluted Earnings Per Share | $0.06 | $0.07 | $0.38 | -14.3% | -84.2% |
Second Quarter 2025 Summary Review
Reminder: on January 1, 2025 we made some adjustments to our segment reporting. Prior year comparative periods have been adjusted accordingly. See Appendix for more detail.
| Net Revenues by Reportable Segment3 (US$ m) | Q2 2025 | Q1 2025 | Q2 2024 | Q/Q | Y/Y |
| Analog products, MEMS and Sensors (AM&S) segment | 1,133 | 1,069 | 1,336 | 5.9% | -15.2% |
| Power and discrete products (P&D) segment | 447 | 397 | 576 | 12.9% | -22.2% |
| Subtotal: Analog, Power & Discrete, MEMS and Sensors (APMS) Product Group | 1,580 | 1,466 | 1,912 | 7.8% | -17.4% |
| Embedded Processing (EMP) segment | 847 | 742 | 906 | 14.1% | -6.5% |
| RF & Optical Communications (RF&OC) segment | 336 | 306 | 410 | 10.1% | -17.9% |
| Subtotal: Microcontrollers, Digital ICs and RF products (MDRF) Product Group | 1,183 | 1,048 | 1,316 | 13.0% | -10.1% |
| Others | 3 | 3 | 4 | – | – |
| Total Net Revenues | $2,766 | $2,517 | $3,232 | 9.9% | -14.4% |
Net revenues totaled $2.77 billion, representing a year-over-year decrease of 14.4%. Year-over-year net sales to OEMs and Distribution decreased 15.3% and 12.0%, respectively. On a sequential basis, net revenues increased 9.9%, 220 basis points better than the mid-point of ST’s guidance.
Gross profit totaled $926 million, representing a year-over-year decrease of 28.5%. Gross margin of 33.5%, 10 basis points above the mid-point of ST’s guidance, decreased 660 basis points year-over-year, mainly due to product mix, lower manufacturing efficiencies and, to a lesser extent, higher unused capacity charges.
Operating income decreased from $375 million in the year-ago quarter to an operating loss of $133 million. ST’s operating margin decreased 1,640 basis points on a year-over-year basis to -4.8% of net revenues, compared to 11.6% in the second quarter of 2024. Operating loss included $190M impairment, restructuring charges and other related phase-out costs for the quarter, reflecting impairment of assets and restructuring charges predominantly associated with the previously announced company-wide program to reshape our manufacturing footprint and resize our global cost base. Excluding these items, non-U.S. GAAP1 Operating income stood at $57 million in the second quarter.
By reportable segment, compared with the year-ago quarter:
In Analog, Power & Discrete, MEMS and Sensors (APMS) Product Group:
Analog products, MEMS and Sensors (AM&S) segment:
- Revenue decreased 15.2% mainly due to a decrease in Analog.
- Operating profit decreased by 55.9% to $85 million. Operating margin was 7.5% compared to 14.5%.
Power and Discrete products (P&D) segment:
- Revenue decreased 22.2%.
- Operating profit decreased from $61 million to an operating loss of $56 million. Operating margin was -12.5% compared to 10.6%.
In Microcontrollers, Digital ICs and RF products (MDRF) Product Group:
Embedded Processing (EMP) segment:
- Revenue decreased 6.5% mainly due to Custom Processing.
- Operating profit decreased by 8.7% to $114 million. Operating margin was 13.5% compared to 13.8%.
RF & Optical Communications (RF&OC) segment:
- Revenue decreased 17.9%.
- Operating profit decreased by 37.2% to $60 million. Operating margin was 17.9% compared to 23.4%.
Net Earnings and diluted Earnings Per Share decreased to a negative $97 million and a negative $0.11 respectively compared to a positive $353 million and $0.38 respectively in the year-ago quarter. Non-U.S. GAAP1 Net income and diluted Earnings Per Share, stood at $57 million and $0.06 respectively in the second quarter of 2025.
Cash Flow and Balance Sheet Highlights
| Trailing 12 Months | ||||||
| (US$ m) | Q2 2025 | Q1 2025 | Q2 2024 | Q2 2025 | Q2 2024 | TTM Change |
| Net cash from operating activities | 354 | 574 | 702 | 2,332 | 4,922 | -52.6% |
| Free cash flow (non-U.S. GAAP1) | (152) | 30 | 159 | 142 | 1,384 | -89.7% |
Net cash from operating activities was $354 million in the second quarter compared to $702 million in the year-ago quarter.
Net Capex (non-U.S. GAAP1), was $465 million in the second quarter compared to $528 million in the year-ago quarter.
Free cash flow (non-U.S. GAAP1) was negative at $152 million in the second quarter, compared to positive $159 million in the year-ago quarter.
Inventory at the end of the second quarter was $3.27 billion, compared to $3.01 billion in the previous quarter and $2.81 billion in the year-ago quarter. Days sales of inventory at quarter-end was 166 days, compared to 167 days for the previous quarter and 130 days for the year-ago quarter.
In the second quarter, ST paid cash dividends to its stockholders totaling $81 million and executed a $92 million share buy-back, as part of its current share repurchase program.
ST’s net financial position (non-U.S. GAAP4) remained strong at $2.67 billion as of June 28, 2025, compared to $3.08 billion as of March 29, 2025, and reflected total liquidity of $5.63 billion and total financial debt of $2.96 billion. Adjusted net financial position (non-U.S. GAAP1), taking into consideration the effect on total liquidity of advances from capital grants for which capital expenditures have not been incurred yet, stood at $2.31 billion as of June 28, 2025.
Corporate developments
On May 28, 2025, STMicroelectronics held its 2025 Annual General Meeting of Shareholders in Amsterdam, the Netherlands. All proposed resolutions were approved by the Shareholders.
Business Outlook
ST’s guidance, at the mid-point, for the 2025 third quarter is:
- Net revenues are expected to be $3.17 billion, an increase of 14.6% sequentially, plus or minus 350 basis points.
- Gross margin of 33.5%, plus or minus 200 basis points.
- This outlook is based on an assumed effective currency exchange rate of approximately $1.14 = €1.00 for the 2025 third quarter and includes the impact of existing hedging contracts.
- The third quarter will close on September 27, 2025.
This business outlook does not include any impact of potential further changes to global trade tariffs compared to the current situation.
Conference Call and Webcast Information
ST will conduct a conference call with analysts, investors and reporters to discuss its second quarter 2025 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 August 8, 2025.
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 may directly or indirectly 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 which may require us to undertake transformation measures that may not be successful in realizing the expected benefits in full or at all;
- 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 macro-economic or regional events, geopolitical and military conflicts, 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 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 IP 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 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 in all direct and indirect emissions (scopes 1 and 2), product transportation, business travel, and employee commuting emissions (our scope 3 focus), and to achieve our 100% renewable electricity sourcing goal by the end of 2027;
- epidemics or pandemics, which may negatively impact the global economy in a significant manner for an extended period of time, and could also materially adversely affect our business and operating results;
- industry changes resulting from vertical and horizontal consolidation among our suppliers, competitors, and customers;
- 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; and
- individual customer use of certain products, which may differ from the anticipated uses of such products and result in differences in performance, including energy consumption, may lead to a failure to achieve our disclosed emission-reduction goals, adverse legal action or additional research costs.
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 risk factors 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, 2024 as filed with the Securities and Exchange Commission (“SEC”) on February 27, 2025. 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 factors listed under “Item 3. Key Information — Risk Factors” from time to time in our Securities and Exchange Commission (“SEC”) filings, could have a material adverse effect on our business and/or financial condition.
