European semiconductor manufacturer STMicroelectronics (STMPA.PA) revised its annual sales forecast downward on Thursday, citing softening demand from automakers and declining orders from laptop and smartphone manufacturers.
The guidance revision followed disappointing first-quarter results from the company. STMicroelectronics, whose clients include Tesla (TSLA.O) and Apple (AAPL.O), now expects revenue for 2024 to range between $14 billion and $15 billion, down from its previous projection of $15.9 billion to $16.9 billion.
According to analysts surveyed by LSEG, the consensus revenue expectation for the year was $16.1 billion.
CEO Jean-Marc Cherry stated, “During the quarter, automotive semiconductor demand slowed more than anticipated, entering a deceleration phase, while the ongoing industrial downturn intensified.”
For the first quarter, the French-Italian firm reported earnings before interest and tax (EBIT) of $551 million, down 54% from the previous year and below analysts’ forecast of $603.82 million in an LSEG poll.
Revenue declined by 18% to $3.46 billion, missing analysts’ consensus of $3.61 billion.
Persistent weakness in automotive and industrial demand has pressured the sector, while investor sentiment remains cautious amid elevated interest rates and escalating tensions in the Middle East.
