Investing.com – Shares of STMicroelectronics N.V. (EPA:STMPA) (NYSE:STM) plunged after the semiconductor solutions provider revised its full-year outlook. The company now anticipates revenues between $13.2 billion and $13.7 billion, with an approximate gross margin of 40%.
For the quarter, the company reported net revenues of $3.23 billion, marking a 25.3% year-over-year decline. While the gross margin came in line with forecasts at 40.1%, the operating margin contracted sharply to 11.6%, reflecting the impact of lower sales and higher operating expenses.
"During the quarter, contrary to our prior expectations, customer orders for Industrial did not improve and Automotive demand declined," said Jean-Marc Chery, ST President and CEO.
The company attributed the decline in gross margins to a combination of product mix shifts, price declines, and higher unused capacity charges.
STMicroelectronics' net income fell to $353 million in Q2 2024, down from $1 billion in the prior-year quarter. Free cash flow also declined to $159 million, compared to $209 million year-over-year. However, the company did initiate a new $1.1 billion share buyback program.
This content was originally published on Investing.com
