Press Release: STMicroelectronics Reports Q1 2026 Financial Results
PR No: C3392C
STMicroelectronics Reports Q1 2026 Financial Results
-- Q126 net revenues at $3.10 billion -- U.S. GAAP Gross margin at 33.8%. Excluding the Purchase Price Allocation (PPA) effects from the acquisition of NXP's MEMS sensor business, non-U.S. GAAP1 gross margin at 34.1% -- U.S. GAAP operating income at $70 million (non-U.S. GAAP1 operating income at $171 million) -- Business outlook at mid-point: Q226 net revenues of $3.45 billion and U.S. GAAP gross margin of 34.8% (non-U.S. GAAP1 gross margin of 35.2%)
Geneva, April 23, 2026 -- STMicroelectronics N.V. ("ST") (NYSE: STM), a global semiconductor leader serving customers across the spectrum of electronics applications, reported U.S. GAAP financial results for the first quarter ended March 28, 2026. This press release also contains non-U.S. GAAP measures (see Appendix for additional information).
ST reported first quarter net revenues of $3.10 billion, gross margin of 33.8%, operating income of $70 million, and net income of $37 million or $0.04 diluted earnings per share (non-U.S. GAAP(1) gross margin of 34.1%, non-U.S. GAAP(1) operating income of $171 million, and non-U.S. GAAP(1) net income of $122 million or $0.13 diluted earnings per share).
Jean-Marc Chery, ST President & CEO, commented:
-- "Q1 net revenues, excluding the contribution of our acquisition of NXP's MEMS sensor business, came above the mid-point of our business outlook range, driven mainly by higher revenues in our engaged customer programs in Personal electronics and CECP. Gross margin was above the mid-point of our business outlook range mainly due to better product mix." -- "On a year-over-year basis, Q1 net revenues increased 23.0%; excluding the contribution of our acquisition of NXP's MEMS sensor business, they increased 21.4%. Q1 gross margin was 33.8%, operating margin was 2.3% and net income was $37 million. On a non-U.S. GAAP1 basis gross margin was 34.1%, operating margin was 5.5% and net income was $122 million." -- "In Q1, despite the macroeconomic uncertainty, we saw improving demand with strong booking and normalized inventory in distribution." -- "Our second quarter business outlook, at the mid-point, is for net revenues of $3.45 billion, increasing 11.6% sequentially and 24.9% year-over-year. Gross margin is expected to be about 34.8%, including about 100 basis points of unused capacity charges. Non-U.S. GAAP1 gross margin is expected to be about 35.2%." -- "ST is now strategically positioned to capture upside from new AI driven programs, leveraging specialized technologies to enable the evolving AI infrastructure, confirming our datacenters revenue expectation to be nicely above $500 million for 2026 and well above $1 billion for 2027."
Quarterly Financial Summary
U.S. GAAP Q1 Q1 (US$ m, except per share data) 2026 Q4 2025 2025 Q/Q Y/Y ---------------------------------- ------ ------- ------ ------- -------- Net Revenues $3,095 $3,329 $2,517 -7.0% 23.0% ---------------------------------- ------ ------- ------ ------- -------- Gross Profit $1,045 $1,172 $841 -10.9% 24.3% ---------------------------------- ------ ------- ------ ------- -------- Gross Margin 33.8% 35.2% 33.4% -140bps 40bps ---------------------------------- ------ ------- ------ ------- -------- Operating Income $70 $125 $3 -43.8% 2,327.6% ---------------------------------- ------ ------- ------ ------- -------- Operating Margin 2.3% 3.8% 0.1% -150bps 220bps ---------------------------------- ------ ------- ------ ------- -------- Net Income (Loss) $37 $(30) $56 - -33.7% ---------------------------------- ------ ------- ------ ------- -------- Diluted Earnings Per Share $0.04 $(0.03) $0.06 - -33.3% ---------------------------------- ------ ------- ------ ------- -------- Non-U.S. GAAP(1) Q1 Q1 (US$ m, except per share data) 2026 Q4 2025 2025 Q/Q Y/Y ---------------------------------- ------ ------- ------ ------- -------- Gross Profit 1,056 1,172 841 -10.0% 25.5% ---------------------------------- ------ ------- ------ ------- -------- Gross Margin 34.1% 35.2% 33.4% -110bps 70bps ---------------------------------- ------ ------- ------ ------- -------- Operating Income $171 $266 $11 -35.7% 1,454.5% ---------------------------------- ------ ------- ------ ------- -------- Operating Margin 5.5% 8.0% 0.4% -250bps 510bps ---------------------------------- ------ ------- ------ ------- -------- Net Income $122 $100 $63 22.0% 93.7% ---------------------------------- ------ ------- ------ ------- -------- Diluted Earnings Per Share $0.13 $0.11 $0.07 18.2% 85.7% ---------------------------------- ------ ------- ------ ------- --------
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(1) Non-U.S. GAAP. See Appendix for reconciliation to U.S. GAAP and information explaining why the Company believes these measures are important.
First Quarter 2026 Summary Review
Q1 Q4 Q1 Net Revenues by Reportable Segment(2) (US$ m) 2026 2025 2025 Q/Q Y/Y ---------------------------------------------------------- ------ ------ ------ ----- ----- Analog products, MEMS and Sensors (AM&S) segment 1,318 1,449 1,069 -9.1% 23.2% ---------------------------------------------------------- ------ ------ ------ ----- ----- Power and discrete products (P&D) segment 389 412 397 -5.4% -1.8% ---------------------------------------------------------- ------ ------ ------ ----- ----- Subtotal: Analog, Power & Discrete, MEMS and Sensors (APMS) Product Group 1,707 1,861 1,466 -8.3% 16.4% ---------------------------------------------------------- ------ ------ ------ ----- ----- Embedded Processing (EMP) segment 975 1,015 742 -4.0% 31.3% ---------------------------------------------------------- ------ ------ ------ ----- ----- RF & Optical Communications (RFOC) segment 409 449 306 -9.0% 33.9% ---------------------------------------------------------- ------ ------ ------ ----- ----- Subtotal: Microcontrollers, Digital ICs and RF products (MDRF) Product Group 1,384 1,464 1,048 -5.5% 32.1% ---------------------------------------------------------- ------ ------ ------ ----- ----- Others 4 4 3 - - ---------------------------------------------------------- ------ ------ ------ ----- ----- Total Net Revenues $3,095 $3,329 $2,517 -7.0% 23.0% ---------------------------------------------------------- ------ ------ ------ ----- -----
Net revenues totaled $3.10 billion, representing a year-over-year increase of 23.0%. Net revenues included about $40 million revenues associated with NXP's MEMS sensor business; excluding this contribution net revenues increased 21.4% on a year-over-year basis. Year-over-year net sales to OEMs and Distribution increased 24.5% and 19.2%, respectively. On a sequential basis, net revenues decreased 7.0% and 8.2% excluding NXP's MEMS sensor business contribution, 50 basis points better than the mid-point of ST's guidance.
Gross profit totaled $1.05 billion, representing a year-over-year increase of 24.3%. Gross margin of 33.8%, increased 40 basis points year-over-year, mainly due to lower unused capacity charges and better product mix. Gross profit included $11 million Purchase Price Allocation (PPA) effects from the acquisition of NXP's MEMS sensor business. Non-U.S. GAAP(1) Gross Margin, excluding this item, was 34.1%. Excluding the impact from NXP's MEMS sensor business and related PPA effects, gross margin stood at 33.9%, 20 basis points better than the mid-point of ST's guidance.
Operating income increased from $3 million in the year-ago quarter to $70 million. ST's operating margin increased on a year-over-year basis to 2.3% of net revenues, compared to 0.1% in the first quarter of 2025. Operating income included $71 million impairment, restructuring charges and other related phase-out costs for the quarter, mainly reflecting charges related to the execution of the previously announced company-wide program to reshape our manufacturing footprint and resize our global cost base and $30 million Purchase Price Allocation (PPA) effects from the acquisition of NXP's MEMS sensor business. Excluding these items, non-U.S. GAAP(1) Operating income stood at $171 million in the first quarter (or 5.5% non-U.S. GAAP(1) operating margin).
By reportable segment, compared with the year-ago quarter:
In Analog, Power & Discrete, MEMS and Sensors (APMS) Product Group:
Analog products, MEMS and Sensors (AM&S)(2) segment:
-- Revenue increased 23.2% mainly due to Imaging and MEMS and, to a lesser extent, Analog. -- Operating profit increased by 95.8% to $161 million. Operating margin was 12.2% compared to 7.7%.
Power and Discrete products (P&D) segment:
-- Revenue decreased 1.8%. -- Operating result decreased from a loss of $28 million to a loss of $84 million. Operating margin was -21.5% compared to -6.9%.
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Press Release: STMicroelectronics Reports Q1 2026 -2-
In Microcontrollers, Digital ICs and RF products (MDRF) Product Group:
Embedded Processing (EMP) segment:
-- Revenue increased 31.3% due to General Purpose MCU and, to a lesser extent, Custom Processing. -- Operating profit increased by 148.7% to $164 million. Operating margin was 16.9% compared to 8.9%.
RF & Optical Communications (RFOC) segment:
-- Revenue increased 33.9%. -- Operating profit increased by 43.4% to $61 million. Operating margin was 14.9% compared to 13.9%.
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(1) Non-U.S. GAAP. See Appendix for reconciliation to U.S. GAAP and information explaining why the Company believes these measures are important.
(2) Q126 revenues associated with NXP's MEMS sensor business were allocated to Analog products, MEMS and Sensors (AM&S) segment.
Net income and diluted Earnings Per Share decreased to $37 million and $0.04 respectively, compared to $56 million and $0.06 respectively in the year-ago quarter. In the first quarter of 2026 non-U.S. GAAP(1) Net income stood at $122 million and non-U.S. GAAP(1) diluted Earnings Per Share stood at $0.13.
Cash Flow and Balance Sheet Highlights
Trailing 12 Months -------------------- -------- ------- ------- ---------------------------- (US$ m) Q1 2026 Q4 2025 Q1 2025 Q1 2026 Q1 2025 TTM Change -------------------- -------- ------- ------- ------- ------- ---------- Net cash from operating activities 534 674 574 2,111 2,680 -21.2% -------------------- -------- ------- ------- ------- ------- ---------- Free cash flow (non-U.S. GAAP(1) ) (723)(2) 257 30 (488) 453 - -------------------- -------- ------- ------- ------- ------- ----------
Net cash from operating activities was $534 million in the first quarter, including about $45 million outflow related to restructuring, compared to $574 million in the year-ago quarter, which benefitted from a positive $147 million inflow from net working capital.
Net Capex (non-U.S. GAAP(1) ), was $362 million in the first quarter compared to $530 million in the year-ago quarter.
Free cash flow (non-U.S. GAAP(1) ) was negative at $723 million in the first quarter compared to positive $30 million in the year-ago quarter. Free cash flow included $895 million cash-out related to the payment for the acquisition of NXP's MEMS sensor business.
Inventory at the end of the first quarter was $3.17 billion, compared to $3.14 billion in the previous quarter and $3.01 billion in the year-ago quarter. Days sales of inventory at quarter-end was 140 days, compared to 130 days for the previous quarter and 167 days for the year-ago quarter.
In the first quarter, ST paid cash dividends to its stockholders totaling $71 million.
ST's net financial position (non-U.S. GAAP(1) ) remained strong at $2.00 billion as of March 28, 2026, compared to $2.79 billion as of December 31, 2025, and reflected total liquidity of $4.57 billion and total financial debt of $2.57 billion. Adjusted net financial position (non-U.S. GAAP(1) ), taking into consideration the effect on total liquidity of advances from capital grants for which capital expenditures have not been incurred yet, stood at $1.69 billion as of March 28, 2026.
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(1) Non-U.S. GAAP. See Appendix for reconciliation to U.S. GAAP and information explaining why the Company believes these measures are important.
(2) Q126 Free cash flow includes $895 million cash-out related to the acquisition of NXP MEMS sensor business.
Corporate developments
On February 2, 2026, ST completed the acquisition of NXP's MEMS sensor business. Announced in July 2025, this transaction focused on automotive safety and non-safety products and sensors for industrial applications, expands ST's global sensors capabilities.
On February 9, 2026, ST announced an expanded strategic collaboration with Amazon Web Services (AWS) through a multi-year, multi-billion USD commercial engagement to enable new high performance compute infrastructure for cloud and AI data centers. This engagement covers a broad range of semiconductor solutions leveraging ST's portfolio of proprietary technologies. ST has issued warrants to AWS for up to 24.8 million ordinary shares of ST. The warrants will vest in tranches over the term of the agreement, with vesting substantially tied to payments for ST products and services by AWS and its affiliates.
Business Outlook
ST's guidance, at the mid-point, for the 2026 second quarter is:
-- Net revenues are expected to be $3.45 billion, an increase of 11.6% sequentially, plus or minus 350 basis points. -- U.S. GAAP Gross margin of 34.8%, plus or minus 200 basis points. Non-U.S. GAAP1 gross margin is expected to be about 35.2%, plus or minus 200 basis points. -- This outlook is based on an assumed effective currency exchange rate of approximately $1.15 = EUR1.00 for the 2026 second quarter and includes the impact of existing hedging contracts. -- The second quarter will close on June 27, 2026.
This business outlook does not include any impact of potential further changes to global trade tariffs compared to the current situation.
Conference Call and Webcast Information
ST will conduct a conference call with analysts, investors and reporters to discuss its first quarter 2026 financial results and current business outlook today at 9:30 a.m. Central European Time (CET) / 3:30 a.m. U.S. Eastern Time (ET). A live webcast (listen-only mode) of the conference call will be accessible at ST's website, https://investors.st.com, and will be available for replay until May 8, 2026.
Use of Supplemental Non-U.S. GAAP Financial Information
This press release contains supplemental non-U.S. GAAP financial information.
Readers are cautioned that these measures are unaudited and not prepared in accordance with U.S. GAAP and should not be considered as a substitute for U.S. GAAP financial measures. In addition, such non-U.S. GAAP financial measures may not be comparable to similarly titled information from other companies. To compensate for these limitations, the supplemental non-U.S. GAAP financial information should not be read in isolation, but only in conjunction with ST's consolidated financial statements prepared in accordance with U.S. GAAP.
See the Appendix of this press release for a reconciliation of ST's non-U.S. GAAP financial measures to their corresponding U.S. GAAP financial measures.
Forward-looking Information
Some of the statements contained in this release that are not historical facts are statements of future expectations and other forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933 or Section 21E of the Securities Exchange Act of 1934, each as amended) that are based on management's current views and assumptions, and are conditioned upon and also involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those anticipated by such statements due to, among other factors:
-- changes in global trade policies, including the continuation, adoption and expansion of tariffs and trade barriers and sanctions, that are affecting and could further affect the macro-economic environment and are adversely impacting and could further adversely impact the demand for our products; -- uncertain macro-economic and industry trends (such as inflation and fluctuations in supply chains), which are impacting and may further impact production capacity and end-market demand for our products; -- customer demand that differs from projections which may require us to undertake transformation measures that may not be successful in realizing the expected benefits in full or at all; -- the ability to design, manufacture and sell innovative products in a rapidly changing technological environment; -- changes in economic, social, public health, labor, political, or infrastructure conditions in the locations where we, our customers, or our suppliers operate, including as a result of macro-economic or regional events, geopolitical and military conflicts, social unrest, labor actions, or terrorist activities; -- unanticipated events or circumstances, which may impact our ability to execute our plans and/or meet the objectives of our research and development and manufacturing programs, which benefit from public funding; -- financial difficulties with any of our major distributors or significant curtailment of purchases by key customers; -- the loading, product mix, and manufacturing performance of our production facilities and/or our required volume to fulfill capacity reserved with suppliers or third-party manufacturing providers; -- availability and costs of equipment, raw materials, utilities, third-party manufacturing services and technology, or other supplies required by our operations (including increasing costs resulting from inflation); -- the functionalities and performance of our IT systems, which are subject to cybersecurity threats and which support our critical operational activities including manufacturing, finance and sales, and any breaches of our IT systems or those of our customers, suppliers, partners and providers of third-party licensed technology; -- theft, loss, or misuse of personal data about our employees, customers, or other third parties, and breaches of data privacy legislation; -- the impact of intellectual property claims by our competitors or other third parties, and our ability to obtain required licenses on reasonable terms and conditions;
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