STMicroelectronics N.V. reported fourth‑quarter 2025 revenue of $3.33 billion, up 1.5 % from $3.32 billion in Q4 2024, and a gross margin of 35.2 %, a 2.5‑percentage‑point decline from the 37.7 % margin recorded in the same quarter last year. Operating income fell to $125 million from $341 million, largely because the company recorded $141 million in impairment, restructuring and phase‑out charges as part of its manufacturing‑reshaping program. Net loss for the quarter was $30 million, or –$0.03 per diluted share, while non‑U.S. GAAP operating income reached $266 million and non‑U.S. GAAP net income was $100 million, or $0.11 per diluted share.
The revenue mix shifted in favor of Personal Electronics and, to a lesser extent, Consumer Electronics & Communications Products (CECP) and Industrial segments, which together contributed 55 % of the quarter’s top line. Personal Electronics grew 7.5 % YoY to $1.45 billion, driven by strong demand for mobile and wearable devices. In contrast, the Power & Discrete (P&D) segment contracted 31.6 % to $412 million, reflecting a slowdown in automotive silicon carbide (SiC) orders. The RF & Optical Communications (RF&OC) segment posted a 22.9 % increase, buoyed by higher demand for 5G infrastructure. These segment dynamics explain the modest revenue growth despite a challenging macro environment.
Full‑year 2025 revenue totaled $11.80 billion, a 11.1 % decline from $13.27 billion in 2024. Gross margin for the year fell to 33.9 % from 39.3 %, and operating margin dropped to 1.5 % from 12.6 %. Net income was $166 million, or $0.37 per diluted share, compared with $1.56 billion in 2024. Non‑U.S. GAAP operating margin was 4.7 % and non‑U.S. GAAP net income was $486 million, or $0.11 per diluted share. Management attributed the revenue decline to weaker automotive demand and higher raw‑material costs, while the margin compression was driven by lower manufacturing efficiencies, higher unused capacity charges and currency headwinds.
CEO Jean‑Marc Chery said the company “returned to year‑over‑year revenue growth in Q4, but profitability remains under pressure.” He noted that the company’s restructuring program, which includes plant closures and workforce reductions, will continue to generate one‑time charges in 2026 but is expected to improve gross margin to 34.5 % by the end of the year. CFO Lorenzo Grandi added that cost‑control initiatives and a focus on high‑margin SiC and RF products should help lift operating income in the next quarter. The company guided for Q1 2026 net revenue of $3.04 billion, a 3.5 % sequential decline, and a gross margin of 33.7 % from 35.2 % in Q4 2025.
Analysts reacted to the earnings miss on non‑U.S. GAAP EPS, which fell $0.17 below the consensus estimate of $0.28. The EPS miss was largely attributed to the $141 million restructuring charge, which was not fully anticipated by the market. Despite the earnings shortfall, the revenue beat and the upward guidance for 2026 were viewed as positive signals of resilience in the face of macro‑economic headwinds. The market’s muted reaction reflects a focus on the company’s long‑term restructuring trajectory and the potential upside from its SiC and RF product lines.
Strategically, STMicroelectronics is positioning itself for a shift toward higher‑margin silicon carbide and RF solutions, while winding down legacy automotive silicon processes. The company’s planned acquisition of NXP’s MEMS sensor business, expected to close in H1 2026, will broaden its sensor portfolio and support growth in automotive and industrial markets. The ongoing restructuring, while painful in the short term, is expected to reduce operating costs and improve margin flexibility, setting the stage for a more sustainable growth path in 2026 and beyond.
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