STMicroelectronics charts path to $12bn

May 14, 2019 // By Nick Flaherty
The management team at STMicroelectronics sees the growth path to reach its target of a $12bn in the next two years through power devices, 5G and the Internet of Things.
The management team at STMicroelectronics has charted its path to reach its target of a $12bn in the next two years through power devices, 5G and the Internet of Things.

“Silicon carbide and soon gallium nitride will be a differentiator – but we are also developing on IGBT and expanding our offer on power modules,” said Jean-Marc Chery, president and CEO of STMicroelectronics, as the company predicts a turnover of between $9.45 and $9.85bn this year.  

But this comes as the industry faces a slowdown that is challenging to hit the advice that the previous CEO, Carlo Bozotti gave to Chery to hit $12bn.

“Since the second half of last year we have witnessed some weakness in the market, particularly a slowdown in China for our general purpose microcontrollers, and as a result inventory started to build up in our distribution channel. As we entered 2019 some economies started to deteriorate,” said Lorenzo Grandi, chief financial officer of STMicroelectronics.

“After two strong years of revenue growth we see 2019 as a temporary pause,” he said. “We expect improved market conditions in the second half of the year.”

“The demand is there, but OEMs and distributors are in an inventory correction,” Chery told analysts in London. “It’s more a mood where people are cautious on overall inventory levels which makes us confident that the end demand is there and we will have the recovery of the market in H2.”

ST has added new areas such as 5G radio front end chips, both at sub 6GHz and 24GHz for a wide range of applications. It has been offering its 28nm FD-SOI process to smatphone makers, and is looking at its own devices for automotive vehicle-to-X (V2X) links, sub-GHz 5G industrial wireless for the IoT and even 5G low earth orbit satellite systems at 24GHz. It has also added phase change memory to its automotive chips as domain controllers to replace numerous electronic control units.  

The company is investing in capacity with a new 300mm fab at Agrate in Italy as well as

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