By Mathieu Rosemain
PARIS (Reuters) -Franco-Italian chipmaker STMicroelectronics on Wednesday reported higher-than-expected earnings in the first quarter as strong demand in microcontrollers offset a temporary fall in production due to COVID-19 restrictions in China.
The Geneva-based company, whose biggest clients include iPhone maker Apple (NASDAQ:AAPL) and electric carmaker Tesla, has beefed up investments to meet high order levels during a turbulent start of the year marked by a global supply chain logjam and soaring energy prices due the Russian invasion or Ukraine.
Fresh lockdowns to combat the Omicron variant of the novel coronavirus in China have led to fall in output from STMicro’s plant in Shenzhen, Chief Executive Officer Jean-Marc Chery said in a statement.
The same lockdowns led chipmakers Texas Instruments (NASDAQ:TXN) and SK Hynix to warn about further disruptions in the supply chains within the industry.
STMicro said its first-quarter sales came slightly above its targets at $3.55 billion for a gross margin of 46.7%, and beat the $3.49 billion average of seven analysts’ estimate compiled by Refinitiv.
Diluted earnings per share over the period came at $0.79 apiece, above Refinitiv’s mean analyst estimate of 71 cents per share.
STMicro forecast its revenue in 2022 to be in the range of $14.8 billion to $15.3 billion. It expects second-quarter net revenue to be about $3.75 billion, reflecting a 5.8% growth compared with the first quarter.
STMicro confirms annual sales target as Q1 earnings beat estimate