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STMicroelectronics (STM)
NYSE:STM

STMicroelectronics (STM) AI Stock Analysis

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STM

STMicroelectronics

(NYSE:STM)

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Neutral 60 (OpenAI - 5.2)
Rating:60Neutral
Price Target:
$31.00
▲(11.19% Upside)
The score is held back primarily by mixed financial performance (pressure on revenue growth and margins) and expensive valuation (high P/E with modest yield). Technicals show an uptrend but are overextended, increasing pullback risk. Earnings call signals modest near-term growth and improving cash generation, but ongoing margin/segment headwinds keep the outlook balanced.
Positive Factors
Diversified end-market exposure
ST's revenue mix across automotive, industrial and personal electronics provides durable demand diversification. Automotive electrification and industrial IoT are multi-year growth vectors; sequential strength in these segments supports steadier revenue as cyclical pockets soften elsewhere.
Conservative balance sheet and low leverage
A low debt-to-equity position gives STMicroelectronics financial flexibility to fund capex, R&D and strategic deals without heavy refinancing risk. This conservatism supports durable investment in manufacturing scale and cushions the company through semiconductor cycles.
Large, strategic manufacturing partnerships and scale
Multi-year supply to SpaceX/Starlink evidences ST's manufacturing scale and Co-design capabilities (BiCMOS). High-volume, long-term contracts improve capacity utilization, justify fabs/R&D investment, and create sticky revenue streams tied to global satellite and telecom expansion.
Negative Factors
Sustained revenue decline
A nearly 17% TTM revenue decline signals material demand or mix challenges that can persist for several quarters. Continued top-line contraction limits operating leverage, pressures investment returns and raises risk that cost cuts cannot fully offset weaker sales.
Gross margin compression
A 460bp year-over-year gross margin decline reflects structural pressure from lower manufacturing efficiencies and currency effects. Reduced gross margins erode operating profitability, constrain reinvestment in R&D and fabs, and heighten dependency on volume recovery to restore margins.
Weak profit-to-cash conversion
Despite a positive quarterly FCF, a negative FCF-to-net-income ratio indicates earnings are not reliably converting to cash. This structural conversion weakness can limit funding for capex, M&A or shareholder returns and raises vulnerability if margins or revenues deteriorate.

STMicroelectronics (STM) vs. SPDR S&P 500 ETF (SPY)

STMicroelectronics Business Overview & Revenue Model

Company DescriptionSTMicroelectronics N.V., together with its subsidiaries, designs, develops, manufactures, and sells semiconductor products in Europe, the Middle East, Africa, the Americas, and the Asia Pacific. The company operates through Automotive and Discrete Group; Analog, MEMS and Sensors Group; and Microcontrollers and Digital ICs Group segments. The Automotive and Discrete Group segment offers automotive integrated circuits (ICs), and discrete and power transistor products. The Analog, MEMS and Sensors Group segment provides industrial application-specific integrated circuits (ASICs) and application-specific standard products (ASSPs); general purpose analog products; custom analog ICs; wireless charging solutions; galvanic isolated gate drivers; low and high voltage amplifiers, comparators, and current-sense amplifiers; MasterGaN, a solution that integrates a silicon driver and GaN power transistors in a single package; wireline and wireless connectivity ICs; touch screen controllers; micro-electro-mechanical systems (MEMS) products, including sensors or actuators; and optical sensing solutions. The Microcontrollers and Digital ICs Group segment offers general purpose and secure microcontrollers; and radio frequency (RF) products. It also offers application-specific standard products for analog, digital and mixed-signal applications. In addition, the company provides assembly and other services. It sells its products through distributors and retailers, as well as through sales representatives. The company serves automotive, industrial, personal electronics and communications equipment, and computers and peripherals markets. STMicroelectronics N.V. was incorporated in 1987 and is headquartered in Schiphol, the Netherlands.
How the Company Makes MoneySTMicroelectronics generates revenue primarily through the sale of semiconductor products across various sectors, with a significant focus on automotive, industrial, and consumer markets. Its revenue model is based on direct sales to original equipment manufacturers (OEMs) and distributors, as well as partnerships with technology firms to develop custom solutions. Key revenue streams include microcontrollers, sensors, and power management products, which are essential for modern electronic devices. Additionally, STMicroelectronics benefits from strategic partnerships and collaborations in research and development, enhancing its product offerings and market reach. The company also capitalizes on trends such as electrification in automotive applications and the growing demand for IoT devices, contributing to its earnings and overall growth.

STMicroelectronics Key Performance Indicators (KPIs)

Any
Any
Revenue by Product
Revenue by Product
Examines revenue generated from individual products, shedding light on best-sellers, market trends, and product lifecycle stages.
Chart InsightsSTMicroelectronics is experiencing a notable decline in revenue from its Analog Power and Microcontrollers segments, reflecting broader challenges in the semiconductor market. Despite sequential growth in automotive and industrial sectors, the company faces significant year-over-year revenue declines across several segments, including a 22.2% drop in Power and Discrete. The earnings call highlights a strategic focus on reshaping manufacturing to achieve cost savings, which could mitigate future margin pressures. However, current gross margin challenges and an operating loss underscore the need for careful navigation in a competitive landscape.
Data provided by:The Fly

STMicroelectronics Earnings Call Summary

Earnings Call Date:Oct 23, 2025
(Q3-2025)
|
% Change Since: |
Next Earnings Date:Jan 29, 2026
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with strong revenue performance in Q3 and notable achievements in Automotive and Industrial segments. However, significant challenges remain in the Power & Discrete segment and overall gross margin, with a cautious revenue outlook for Q4.
Q3-2025 Updates
Positive Updates
Revenue Performance
Q3 revenues at $3.19 billion, $17 million above the midpoint of business outlook, with Personal Electronics performing better than expected.
Automotive Growth
Automotive revenues grew about 10% sequentially, with a book-to-bill ratio above 1. Expected mid-single digit growth in Q4.
Industrial Revenue Growth
Industrial revenues increased 8% sequentially and 13% year-over-year, marking a return to year-on-year growth for the first time since Q3 2023.
Free Cash Flow
Generated a positive $130 million free cash flow in Q3.
NXP MEMS Acquisition
Entered into a definitive agreement to acquire NXP's MEMS sensor business for up to $950 million in cash.
Negative Updates
Gross Margin Decline
Gross margin was 33.2%, decreasing 460 basis points year-over-year due to lower manufacturing efficiencies and negative currency effects.
Power & Discrete Segment Performance
Power & Discrete products revenue decreased 34.3% year-over-year, affecting overall segment profitability.
Automotive Market Challenges
Despite sequential growth, Automotive was still down by about 70% year-over-year, attributed to decreased capacity reservation fees and lower volumes from key customers.
Q4 Revenue Outlook Below Seasonality
Guidance for Q4 indicates below seasonal revenue growth of 2.9% due to automotive sector issues and inventory adjustments in Industrial.
Company Guidance
During the third quarter 2025 earnings call, STMicroelectronics provided guidance for Q4 2025, projecting revenues at $3.28 billion, a sequential increase of 2.9%, with a gross margin expected to be around 35%. The company noted a 10% sequential growth in automotive revenues, despite challenges in the Americas, and highlighted strong design activity in industrial applications, contributing to an 8% sequential revenue increase in that segment. The company also managed to reduce inventories, generating $130 million in positive free cash flow. For the full year 2025, STMicroelectronics anticipates revenues of approximately $11.75 billion, translating to a 22.4% growth in the second half compared to the first half, with a gross margin expected to be about 33.8%. The guidance reflects a strategic focus on innovation, reshaping manufacturing capabilities, and optimizing investments.

STMicroelectronics Financial Statement Overview

Summary
STMicroelectronics shows mixed financial performance. The company maintains operational efficiency and a strong balance sheet with low leverage, but faces challenges in revenue growth and profitability margins. Cash flow metrics show improvement in free cash flow growth, yet conversion of profits to cash remains a concern.
Income Statement
65
Positive
STMicroelectronics has shown a decline in revenue growth with a negative growth rate in the TTM period, indicating potential market challenges. The gross profit margin and net profit margin have decreased over the years, reflecting pressure on profitability. However, the company maintains a reasonable EBIT and EBITDA margin, suggesting operational efficiency.
Balance Sheet
72
Positive
The company has a low debt-to-equity ratio, indicating a conservative leverage position, which is a positive sign of financial stability. However, the return on equity has decreased in the TTM period, suggesting reduced profitability for shareholders. The equity ratio remains strong, reflecting a solid capital structure.
Cash Flow
60
Neutral
The free cash flow growth rate has improved significantly in the TTM period, but the free cash flow to net income ratio is negative, indicating potential issues in converting profits into cash. The operating cash flow to net income ratio is moderate, suggesting adequate cash generation from operations.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue11.78B13.27B17.29B16.13B12.76B10.22B
Gross Profit3.80B5.22B8.29B7.63B5.33B3.79B
EBITDA2.67B3.72B6.38B5.71B3.42B2.24B
Net Income622.98M1.56B4.21B3.96B2.00B1.11B
Balance Sheet
Total Assets24.81B24.74B24.45B19.98B15.54B14.45B
Cash, Cash Equivalents and Short-Term Investments4.80B6.18B6.08B4.52B3.52B3.72B
Total Debt2.18B3.17B3.17B2.91B2.74B2.82B
Total Liabilities6.62B7.06B7.60B7.22B6.27B5.95B
Stockholders Equity17.95B17.45B16.73B12.69B9.21B8.45B
Cash Flow
Free Cash Flow106.19M-216.00M1.46B1.57B1.12B735.00M
Operating Cash Flow2.16B2.96B5.99B5.20B3.06B2.09B
Investing Cash Flow-1.57B-3.74B-5.77B-4.59B-1.52B-2.04B
Financing Cash Flow-1.67B-155.00M-267.00M-567.00M-1.31B348.00M

STMicroelectronics Technical Analysis

Technical Analysis Sentiment
Positive
Last Price27.88
Price Trends
50DMA
25.16
Positive
100DMA
26.25
Positive
200DMA
26.10
Positive
Market Momentum
MACD
0.87
Negative
RSI
58.23
Neutral
STOCH
54.97
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STM, the sentiment is Positive. The current price of 27.88 is above the 20-day moving average (MA) of 27.00, above the 50-day MA of 25.16, and above the 200-day MA of 26.10, indicating a bullish trend. The MACD of 0.87 indicates Negative momentum. The RSI at 58.23 is Neutral, neither overbought nor oversold. The STOCH value of 54.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for STM.

STMicroelectronics Risk Analysis

STMicroelectronics disclosed 33 risk factors in its most recent earnings report. STMicroelectronics reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 1 New Risks
1.
Individual customer use of certain products, which may differ from the anticipated uses of such products and result in differences in performance, including energy consumption, may lead to a failure to achieve our disclosed emission-reduction goals, adverse legal action or additional research costs. Q4, 2024

STMicroelectronics Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
73
Outperform
$24.38B79.063.87%-16.13%-81.06%
69
Neutral
$40.67B36.3411.17%2.29%8.01%10.41%
69
Neutral
$21.52B17.0410.97%6.06%5.87%-20.93%
63
Neutral
$22.98B-0.38%0.25%-106.22%
61
Neutral
$37.18B12.37-10.20%1.83%8.50%-7.62%
60
Neutral
$25.07B49.023.00%1.28%-17.33%-76.71%
55
Neutral
$16.11B-265.28-4.42%32.58%-173.04%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
STM
STMicroelectronics
27.88
3.47
14.22%
ASX
ASE Technology Holding Co
18.88
8.64
84.37%
MTSI
MACOM Technology Solutions Holdings
215.01
72.24
50.60%
ON
ON Semiconductor
60.58
7.07
13.21%
UMC
United Micro
8.79
2.86
48.23%
GFS
GlobalFoundries Inc
41.35
0.42
1.03%

STMicroelectronics Corporate Events

STMicroelectronics Shareholders Approve New Supervisory Board Appointments at EGM
Dec 18, 2025

On December 18, 2025, STMicroelectronics announced that shareholders at its Extraordinary General Meeting in Amsterdam approved all proposed resolutions concerning changes to the company’s Supervisory Board. The meeting confirmed the appointments of Armando Varricchio and Orio Bellezza as new members of the Supervisory Board, each with a term running until the conclusion of the 2028 Annual General Meeting, reinforcing the group’s governance structure and board continuity for the medium term.

The most recent analyst rating on (STM) stock is a Hold with a $26.00 price target. To see the full list of analyst forecasts on STMicroelectronics stock, see the STM Stock Forecast page.

STMicroelectronics and SpaceX Mark Ten Years of Starlink Partnership
Dec 15, 2025

On December 15, 2025, STMicroelectronics and SpaceX celebrated a decade-long partnership that has significantly contributed to the success of SpaceX’s Starlink project, which provides global broadband connectivity via low Earth orbit satellites. This collaboration has resulted in the co-design and production of billions of custom-made components for Starlink’s user terminals and satellites, leveraging ST’s BiCMOS chip technology. The partnership has enabled SpaceX to scale production to meet the growing demand for high-speed internet, with over 8 million users across more than 150 countries. The ongoing collaboration focuses on advancing next-generation satellite technologies and user terminals, reinforcing ST’s position as a key player in the semiconductor industry and enhancing SpaceX’s capabilities in delivering reliable internet connectivity worldwide.

The most recent analyst rating on (STM) stock is a Hold with a $22.00 price target. To see the full list of analyst forecasts on STMicroelectronics stock, see the STM Stock Forecast page.

STMicroelectronics and EIB Secure €1 Billion Deal to Boost European Semiconductor Industry
Dec 11, 2025

On December 11, 2025, STMicroelectronics and the European Investment Bank (EIB) announced a €1 billion agreement to enhance Europe’s competitiveness and strategic autonomy in the semiconductor industry. The first €500 million tranche will support research and development and high-volume chip manufacturing in Italy and France. This agreement marks the ninth collaboration between EIB and ST, bringing total financing to approximately €4.2 billion, and aims to bolster Europe’s technological sovereignty and create high-skilled jobs.

The most recent analyst rating on (STM) stock is a Hold with a $22.00 price target. To see the full list of analyst forecasts on STMicroelectronics stock, see the STM Stock Forecast page.

STMicroelectronics Completes Share Buyback Program in November 2025
Dec 1, 2025

On December 1, 2025, STMicroelectronics announced the completion of a share buyback program, repurchasing 206,478 ordinary shares between November 24 and November 25, 2025, at an average price of EUR 19.1345 per share. This buyback, aimed at fulfilling obligations related to employee share options and other allocations, reflects the company’s strategic financial management and its commitment to shareholder value. The shares, representing 0.02% of the issued share capital, may be held in treasury or used for other lawful purposes, indicating flexibility in the company’s capital allocation strategy.

The most recent analyst rating on (STM) stock is a Hold with a $22.00 price target. To see the full list of analyst forecasts on STMicroelectronics stock, see the STM Stock Forecast page.

STMicroelectronics Completes Share Buyback Program in November 2025
Nov 24, 2025

STMicroelectronics announced the completion of a share repurchase program from November 17 to November 21, 2025, acquiring 645,149 ordinary shares at an average price of EUR 19.2883, totaling EUR 12,443,841.94. This buyback, conducted on Euronext Paris, is part of the company’s strategy to meet obligations from share option programs and potentially other lawful purposes, reflecting its ongoing commitment to shareholder value and market strategy.

The most recent analyst rating on (STM) stock is a Hold with a $23.00 price target. To see the full list of analyst forecasts on STMicroelectronics stock, see the STM Stock Forecast page.

STMicroelectronics Completes Share Buy-Back Program in November 2025
Nov 17, 2025

On November 17, 2025, STMicroelectronics announced the completion of a share buy-back program conducted from November 10 to November 14, 2025. During this period, the company repurchased 459,424 ordinary shares, representing 0.05% of its issued share capital, at an average price of EUR 20.4957 per share, totaling EUR 9,416,236.25. This initiative is part of the company’s strategy to fulfill obligations related to share option programs and other allocations. The repurchased shares may be held in treasury or used for other lawful purposes, reflecting STMicroelectronics’ ongoing efforts to manage its capital structure effectively.

The most recent analyst rating on (STM) stock is a Buy with a $35.00 price target. To see the full list of analyst forecasts on STMicroelectronics stock, see the STM Stock Forecast page.

STMicroelectronics Completes Share Buyback Program in November 2025
Nov 10, 2025

On November 10, 2025, STMicroelectronics announced the completion of a share repurchase program conducted from November 3 to November 7, 2025. During this period, the company repurchased 560,000 ordinary shares, representing 0.06% of its issued share capital, at an average price of EUR 20.7751 per share, totaling EUR 11,634,070.50. The purpose of the buyback is to fulfill obligations related to share option programs and other share allocations to employees and management. This strategic move is part of STMicroelectronics’ broader efforts to manage its capital structure and support its long-term financial strategy.

The most recent analyst rating on (STM) stock is a Buy with a $35.00 price target. To see the full list of analyst forecasts on STMicroelectronics stock, see the STM Stock Forecast page.

STMicroelectronics Reports Q3 2025 Financial Results
Nov 5, 2025

STMicroelectronics released its financial results for the third quarter and nine months ending September 27, 2025. The company reported net revenues of $3.187 billion for the third quarter, marking a 15.2% sequential increase but a 2.0% year-over-year decline. The gross margin stood at 33.2%, slightly down from the previous year. These results reflect the company’s ongoing efforts to manage its financial performance amid varying market conditions. The report also includes certifications and an analysis of financial operations, providing insights into the company’s strategic positioning and operational adjustments.

The most recent analyst rating on (STM) stock is a Buy with a $35.00 price target. To see the full list of analyst forecasts on STMicroelectronics stock, see the STM Stock Forecast page.

STMicroelectronics Completes Share Buyback Program in Late October 2025
Nov 3, 2025

On November 3, 2025, STMicroelectronics announced the completion of a share repurchase program, buying back 347,647 ordinary shares between October 27 and October 31, 2025. This repurchase, amounting to approximately EUR 7.5 million, represents 0.04% of the company’s issued share capital and is part of a strategy to meet obligations related to share option programs for employees and management. The move is aligned with the company’s broader financial strategies and regulatory compliance, potentially impacting shareholder value and market perception.

The most recent analyst rating on (STM) stock is a Buy with a $35.00 price target. To see the full list of analyst forecasts on STMicroelectronics stock, see the STM Stock Forecast page.

STMicroelectronics Completes Share Buy-Back Program in October 2025
Oct 27, 2025

On October 27, 2025, STMicroelectronics announced the completion of a share buy-back program conducted between October 20 and October 24, 2025. During this period, the company repurchased 379,674 ordinary shares, representing 0.04% of its issued share capital, at an average price of EUR 23.8269 per share, totaling EUR 9,046,447.55. The repurchase aims to fulfill obligations related to share option programs and other allocations to employees and management. This strategic move is part of the company’s broader efforts to manage its capital structure and enhance shareholder value.

The most recent analyst rating on (STM) stock is a Hold with a $26.00 price target. To see the full list of analyst forecasts on STMicroelectronics stock, see the STM Stock Forecast page.

STMicroelectronics Announces Q3 2025 Financial Results Amid Market Challenges
Oct 23, 2025

On October 23, 2025, STMicroelectronics announced its third-quarter financial results, reporting net revenues of $3.19 billion, a slight decrease of 2.0% year-over-year. Despite a challenging market environment, the company achieved a gross margin of 33.2% and net income of $237 million. The company anticipates a sequential revenue increase in the fourth quarter, with a forecasted gross margin improvement to 35.0%. STMicroelectronics is focusing on optimizing investments and reshaping its manufacturing footprint to enhance operational efficiency and strengthen cash flow generation.

The most recent analyst rating on (STM) stock is a Hold with a $28.00 price target. To see the full list of analyst forecasts on STMicroelectronics stock, see the STM Stock Forecast page.

STMicroelectronics Announces Key Board Appointments Ahead of December Meeting
Oct 23, 2025

On October 23, 2025, STMicroelectronics announced the resolutions to be proposed at its Extraordinary General Meeting of Shareholders, scheduled for December 18, 2025, in Amsterdam. The Supervisory Board has proposed the appointments of Armando Varricchio and Orio Bellezza to the Supervisory Board, replacing Maurizio Tamagnini and Paolo Visca, who resigned earlier in the year. This meeting and the proposed changes are significant for the company’s governance structure, potentially impacting its strategic direction and stakeholder relationships.

The most recent analyst rating on (STM) stock is a Hold with a $28.00 price target. To see the full list of analyst forecasts on STMicroelectronics stock, see the STM Stock Forecast page.

STMicroelectronics Completes Share Buyback Program in October 2025
Oct 20, 2025

On October 20, 2025, STMicroelectronics announced the completion of a share buyback program conducted between October 13 and October 17, 2025. During this period, the company repurchased 292,850 ordinary shares, representing 0.03% of its issued share capital, at a total cost of EUR 7,188,651.84. The buyback was part of a strategy to fulfill obligations related to share option programs and other allocations to employees and management. This move reflects the company’s ongoing efforts to manage its capital structure and provide value to its stakeholders.

The most recent analyst rating on (STM) stock is a Buy with a $32.00 price target. To see the full list of analyst forecasts on STMicroelectronics stock, see the STM Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jan 07, 2026