Despite the softness in the legacy automotive and industrial market, revenues inched up 1.2% to $2.55 billion, driven by its new products. Analysts had, on an average, expected $2.5 billion. Sales to OEMs increased 7.2%, while Distribution decreased 11.6%.
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The top-line was driven by a 7.7% growth in the Analog, MEMS and Sensors Group (AMS). The company’s other two segments – Automotive and Discrete Group (ADG) and Microcontrollers and Digital ICs Group (MDG) were down year-over-year.
Outlook
For the fourth quarter, STMicroelectronics expects net income to grow 5.0% sequentially, plus or minus 350 basis points. Gross margin is expected around 38.2%, plus or minus 200 basis points.
STM stock has gained 50% since the beginning of this year.
Earlier this week, rival Texas Instruments Incorporated (NASDAQ: TXN) reported a 9% decrease in earnings for the third quarter of 2019 due to broad-based weakness in the overall demand of its product portfolio as well as macro-environment uncertainty.