ST Microelectronics - New York Shares
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Earnings Call Q3 2026
October 29, 2026 - AI Summary
Q3 2026 headline results beat the plan (growth + profitability + cash):
- Net revenues: $3.76B, above the midpoint of guidance; +24.7% YoY and +10.5% sequential implied by Q4 setup (Q3 itself described as above midpoint).
- Gross margin: 37.3% (410 bps higher YoY, +250 bps sequential), helped by better mix and lower unused capacity charges; includes ~60 bps unused capacity charges and ~40 bps negative from non-recurring manufacturing reshaping costs.
- Non-U.S. GAAP EPS (diluted): $0.37.
- Free cash flow: +$351M; inventory increased slightly to support expected Q4 growth (distribution inventory down below target).
- Book-to-bill: well above 2 overall and >1 in every end market, indicating strong demand vs supply.
Segment / end-market strength is broad, but AI Datacenter + LEO are the key drivers:
- Embedded Processing revenue: +24.1% YoY (driven by general-purpose MCUs; RF/optical communication also strong).
- Power & Discrete: +11.3% YoY.
- Analog, MEMS & Sensor: +8.8% YoY.
- End markets YoY: Communication Equipment & Computer Peripheral +64%, Industrial +40%, Automotive +5%, Personal Electronics -4%.
- AI Datacenter revenue (ST’s stated “~$1.3B” in 2026):
- 2026 expectation: ~$1.3B datacenter revenue, ~85% from MDRF (microcontroller + silicon photonics/electronic ICs/BiCMOS).
- 2027: “well above doubling” vs 2026; silicon photonics becomes “tens of percent” of datacenter revenue in 2027.
- LEO satellite comms: momentum broad across programs; next year expected “as good, if not better” than 2026, but management frames it as capacity-gated rather than demand-gated.
Manufacturing reshaping is the main swing factor for margins (timing matters):
- Intermediate model goal: 44%–46% gross margin once reshaping plan completes.
- Near-term gross margin path includes temporary headwinds in Q4: expected ~40 bps unused capacity + ~30 bps non-recurring reshaping costs.
- “Step function” effect: management indicated a ~400 bps improvement tied to closing legacy fabs, visible toward end of 2027 / beginning of 2028, subject to customer qualification timing (one fab still has some discussion).
- Investors should note: management did not promise a smooth quarter-to-quarter path; gross margin improvement is expected to continue progressively before the step, but the largest jump is tied to closure/qualification.
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$69.25
51.9% upsideST Microelectronics - New York Shares Target Price Details
Target Price by Analysts
51.9% upsideST Microelectronics - New York Shares Target Price Details$7.03
84.6% downside
Current Fair Value
84.6% downsideOvervalued by 84.6% based on the discounted cash flow analysis.
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Share Statistics
| Market cap | $41.80 Billion |
|---|---|
| Enterprise Value | $42.80 Billion |
| Annual dividend | $0.36 |
| Dividend yield | 0.75% |
| Earnings per Share | $0.19 |
| Beta | 1.52 |
| Outstanding Shares | 881,818,182 |
Return
| Return on Equity | 2.95% |
|---|---|
| Return on Assets | 1.92% |
| Return on Invested Capital | 3.95% |
Valuation & Multiples
| P/E Ratio | 80.12 |
|---|---|
| PEG | 343.62 |
| Price to Sales | 3.04 |
| Price to Book Ratio | 2.28 |
| Enterprise Value to Revenue | 3.12 |
| Enterprise Value to EBIT | 48.2 |
| Enterprise Value to Net Income | 82 |
| Total Debt to Enterprise | 0.1 |
| Debt to Equity | 0.23 |
Revenue Sources
No data
Last Earnings Call
Report Date
October 29, 2026
EPS Estimate
$0.40
Consensus analyst estimateRevenue Estimate
$3.72 B
Consensus analyst estimateNext Earnings Call
Expected Date
January 28, 2027
EPS Estimate
$0.53
Consensus analyst estimateRevenue Estimate
$4.15 B
Consensus analyst estimateInstitutional Put/Call Ratio
Compares institutional put options with call options. At 0.05, the ratio is below 1, so institutions hold more calls than puts.
| Put/Call Ratio | 0.0476▼ 66.77% |
|---|---|
| Total Calls | 208,000▼ 98.00% |
| Total Puts | 9,900▼ 99.87% |
Institutional Ownership
Holdings and activity of institutional investors.
| Ownership % | 0.36%▼ 18.80% |
|---|---|
| Total Invested | $169.82M▼ 98.67% |
| Investors Holding | 177▼ 496.00% |
About ST Microelectronics
49,157 employees
CEO: Pietro Palella
STMicroelectronics N.V. operates globally as a semiconductor company, focusing on the design, development, manufacturing, and sale of its products across Europe, the Middle East, Africa, the Americas, and the Asia Pacific region. The fir...