STMicroelectronics had Q209 revenues of $1.99bn which were 20% up on the $1.6bn revenues of Q109. ST's Q209 net loss of $318m, compared to Q109's net loss of $541m, and Q208's net loss of $47m. The Q209 operating loss of $428m, was up on the Q208 operating loss of $393, and down on the $26m operating loss of Q208. Gross margin of around 26% was about the same for both Q109 and Q209.
"Revenue came in above the high end of our internal planning target range principally driven by stronger-than-expected performance across most market segments", said Carlo Bozotti, CEO of ST.
Compared to Q208's revenues of $2.4bn, Q209's $1.99bn of revenues showed a 17% decline.
ST took an $86m charge in restructuring costs in Q209, following on the $56m charge it took for re-structuring in Q109.
ST's revenues in Q209 compared to Q109, showed growth in all segments with computer increasing by 36%, automotive by 19%, telecom by 14%, industrial by 7% and consumer by 1%. Distribution registered the strongest sequential improvement by 44%.
"It is clear that the global recession has negatively impacted our financial results in the first half of 2009, but it has not slowed our efforts to develop leading-edge products", said Bozotti, "in the second quarter our pace of innovation continued as we brought to the market many next-generation products including analogue controllers and power MOSFETs for power management in computer motherboards, high-voltage MDMesh power MOSFETs for switched-mode power supplies, MEMS gyroscopes, and advanced GPS solutions. Additionally, we ramped-up 55nm technology in ICs for set-top-boxes and, in wireless, we shipped in volume TD-SCDMA devices."
Bozotti said he expected the worldwide semiconductor market to drop by 20% this year, and that he expects ST to outperform the market. He sees an improving second half for ST, forecasting Q3 revenue between $2.07bn to $2.27bn.
"As we enter the third quarter, we are encouraged as our backlog, including frame orders, is higher than it was when we entered the second quarter of 2009", said Bozotti, "based on current booking activity and visibility, we expect to register solid sequential revenue growth in all market segments and geographies. Additionally, we expect our gross margin to increase sequentially due to partially recovered operating efficiencies, an increase in fab utilisation to about 75%, still leading to some further reduction in inventory, and an improved product mix. Early booking indicators for the fourth quarter are positive."
ST reduced its inventories by $400m in the first half and accelerated inventory turns from 2.9 to 4.1.
"We are driving down the Company's break-even point through the previously announced one billion dollar savings and productivity plan", said Bozotti, "this broad-reaching plan encompasses manufacturing, the rationalisation of sites, and capturing synergies in wireless. We are in-line with our plan to lower costs by $750 million in 2009 and expect a majority of those savings to be realized in the second half of 2009."
It was announced today that ST will be a customer of Globalfoundries, the silicon foundry business spun out of AMD and backed by Abu Dhabi.