ST capital expenditure plan for 2022: unchanged at US$3.4-3.6 billion as planned
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Update time : 2022-10-31 14:54:37
Despite the gloom hanging over the global semiconductor industry, STMicroelectronics President and CEO Jean-Marc Chery believes the company's full-year 2022 revenues and gross margins will be in line with STMicroelectronics' July expectations. "The midpoint of our fourth quarter guidance translates into full year 2022 revenue growth of approximately 26.2% to $16.1 billion. Gross margin is 47.3%." As the industry sees chipmakers and foundries cutting capital expenditures in response to the economic downturn, ST said it is on track with its 2022 capital expenditure plan, spending about $3.4 billion to $3.6 billion.
Chipmaker STMicroelectronics reported third-quarter net revenue of $4.32 billion, up 12.6 per cent sequentially and 35.2 per cent year-on-year. This represents a doubling of net income from $474 million in the fourth quarter of 2021.
For the fourth quarter of 2022, the company expects its quarterly net revenue to increase by 1.8% sequentially to $4.4 billion, with a gross margin of approximately 47.3%.
ST saw growth in all of its product groups and subgroups. The Automotive and Discrete Devices Group (ADG), which accounted for 36% of ST's revenues in the third quarter, reported a 55% year-on-year increase in revenues. The Microcontrollers and Digital Integrated Circuits Group (MDG), which accounts for 32 percent of ST's revenue, reported a 47.7 percent year-on-year increase in revenue. In comparison, the company's Analog, MEMS and Sensors Group (AMS) reported revenue growth of 9.7 percent year-on-year.
"From an end-market perspective, automotive and what we call the B2B segment of the industrial market - namely factory automation and industrial infrastructure - remained strong," Chery said. The CEO also noted that the consumer, industrial and personal electronics markets are softening, as are computer peripherals.
ST attributed the strong demand in the third quarter to the impact of the industry's continued electrification and digitisation, as well as the popularity of semiconductors in traditional vehicles and the replenishment of inventories throughout the automotive supply chain. "Bookings remained strong across all customers and regions," said Chery, "and backlog visibility remained at more than 18 months, well above our current and planned manufacturing capacity through 2023."
ST's chief executive said the company has 110 projects between the automotive and industrial markets, 60 per cent of which are for automotive customers. The company's silicon carbide (SiC) has become a prominent growth driver. According to ST, SiC revenues will reach $700 billion this year, which is in line with its target of $1 billion in revenues by the end of 2023.
According to ST, it will continue to invest in its new 300mm wafer fab in Agrate, Italy, and expects to achieve first production increases in the first half of 2023. Meanwhile, its integrated SiC substrate fab in Catania, Italy, announced in October, will start production in the second half of 2023.
