STMicroelectronics NV (NYSE:STM) stock gained after CEO Jean-Marc Chery said the company expects 2026 to begin at normal levels, emphasizing that this year’s weaker-than-expected recovery will not result in excess customer inventory.
Speaking at a Morgan Stanley conference, Chery projected first-quarter revenue to fall 10%–11% from the upcoming fourth quarter, which the company forecast at $3.28 billion, but still reflects about 20% year-over-year growth, Reuters reported on Wednesday.
STMicroelectronics shares plunged over 9% on October 23 after margin pressure and a cautious outlook outweighed its stronger-than-expected third-quarter 2025 results.
Also Read: STMicroelectronics’ Restructuring Fuels Loss, Eyes Strong Q3 Recovery
The chipmaker, which supplies Apple Inc (NASDAQ:AAPL) and Tesla Inc (NASDAQ:TSLA), posted $3.19 billion in revenue—slightly above estimates—but saw gross margin shrink by 460 bps to 33.2% and operating margin drop 610 bps to 5.6% due to weaker manufacturing efficiency and an unfavorable product mix.
Despite EPS of $0.29 topping forecasts, profitability fell sharply. STMicroelectronics cut 2025 capex to below $2 billion as it adjusts to soft demand and geopolitical uncertainty. The management signaled confidence in a gradual recovery of margins as factory utilization improves.
Price Action: STM stock was trading higher by 2.78% to $24.36 premarket at last check on Wednesday.
Read Next:
Photo: Shutterstock
Market News and Data brought to you by Benzinga APIs
© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.