Slide 1: STMicroelectronics Financial Overview
STMicroelectronics Financial Overview Lorenzo Grandi President and Chief Financial Officer
Slide 2: The $20B+ ambition is postponed but still intact
The $20B+ ambition is postponed but still intact A new intermediate point in FY 2027/2028 is set Revenue trajectory ~$18B $20B+ $17.3B $13.3B* 8-11% CAGR 2023 2024 2027-2028 By 2030 Considering a changing market and competitive environment, we set a new intermediate Financial Model on the path towar
Slide 3: On average ST has grown in line with its SAM
On average ST has grown in line with its SAM ST Revenues and ST SAM (US$B) ST SAM ST Revenues 25 2017-24 CAGR 300 ST revenues SAM 20 250 SAM: +7% 200 15 150 10 100 5 50 ST: +7% 0 * 0 2017 2018 2019 2020 2021 2022 2023 2024* ST grew faster than its SAM in 2017-2023. 2024 impacted by correction in Ind
Slide 4: Average profitability and FCF increased over the period
Average profitability and FCF increased over the period ST Operating Margin (%) ST FCF** and Adjusted Net Financial Position** (US$M) 40% 3,500 35% 2017-20 average: 13% 2021-24 average: 21% 3,000 Cumulative FCF 2017-24: ~$6.6B 30% 2,500 25% Adj. NFP: +$2.3B in 2024 vs 2017 2,000 20% 1,500 15% Free C
Slide 5: We have invested for future growth
We have invested for future growth Capacity increase and transformation Net Capex (US$B) FY 22 – FY 24 key investments Net Capex / - Crolles 300 mm cleanroom extension to support ramp-up Net Revenues Selected capacity increase - Agrate 300 mm initial ramp up 5 - New Integrated SiC Fab in Catania 35%
Slide 6: What has changed since 2022
What has changed since 2022 ST SAM expectations reduced by 16% on What has changed average for 2024-25 vs May 22 • Reduced ST SAM expectations ST SAM • EV growing at a slower pace than expected (US$B) • All end-Markets gradually entering correction post 310 shortage at various times and with varying
Slide 7: Introducing a new intermediate financial model towards the $20B+ ambition
Introducing a new intermediate financial model towards the $20B+ financial ambition Key financials Intermediate $20B+ ambition model (2027/28) (by 2030) Revenue ~$18B $20B+ Gross Margin ~44-46% ~50% Operating Margin ~22-24%* >30% Free Cash Flow Margin** ~20%* >25% Financials assume a currency exchan
Slide 8: Targeting to grow around twice as fast as our SAM
Targeting to grow around twice as fast as our SAM 2024 to 2027-28 CAGR ~$18B ST revenues: 8-11%* $13.3B ST SAM: ~5%** Revenue 2024 Accelerated growth drivers Others Revenue 2027-28 * Based on Mid-point of Q4 2024 outlook translating into 2024 revenues of $13.27B and on revenues of ~$18B in 2027-28 A
Slide 9: Revenue growth: end-market view
Revenue growth: end-market view End market contribution to growth ST revenues CAGR by end market between 2024 and 2027-28 between 2024 and 2027-28 (%) Communications equipment & computer peripherals (CECP) Automotive: High-single-digit Personal 9% electronics (PE) Industrial: Mid-to-high-teens 15% A
Slide 10: Revenue growth: reportable segments view
Revenue growth: reportable segments view Reportable segments contribution to growth Growth CAGR by reportable segment between 2024 and 2027-28 between 2024 and 2027-28 (%) Digital ICs and RF Products (D&RF) AM&S: Mid to high-single-digit Analog products, 11% MEMS & Sensors Microcontrollers (AM&S) (M
Slide 11: Strengthening revenue growth capability and improving operating efficiency
Strengthening revenue growth capability and improving operating efficiency Delivering enhanced product development Implementing new organization innovation and efficiency, time-to-market as well as customer focus by end market. Reshaping of manufacturing footprint Improve productivity / efficiency o
Slide 12: New organization to increase efficiency
New organization to increase efficiency Moving from three to two Product New application marketing Groups split in four Reportable organization by end market Segments implemented across all ST Regions Increase value extraction from our broad Getting even closer to our customers and unique product an
Slide 13: Accelerating transition to 300 mm silicon & 200 mm SiC
Accelerating transition to 300 mm silicon & 200 mm SiC Split of silicon production value by wafer size (%) Current Mid-term (end 27-28) Long-term (after 2030) 6% 4% 12% 29% 37% 46% 42% 150 mm 57% 67% 200 mm 300 mm Silicon carbide accelerating transition to 200 mm Joint Venture with Sanan Optoelectro
Slide 14: Resizing our Opex base
Resizing our Opex base Net Opex* to Net Revenues ratio (%) Accelerating efficiency 40% on SG&A and R&D 35% Average New organization reducing incremental 2017-24: ~24% resources required for innovation and go-to- 30% market 25% ~22% 20% Automation and digitalization of G&A processes triggering less r
Slide 15: High triple-digit $M range annual cost savings exiting 2027
High triple-digit $M range annual cost savings exiting 2027 Evolution of Total Cost structure ($B) ~$11.8B Key financials High-single digit % reduction of overall current cost structure Mix of Cash and Non-Cash items High-triple digit $m Opex savings starting to be partially visible from 2025, COGS
Slide 16: Key drivers of operating margin improvement
Key drivers of operating margin improvement ~22-24% >12% Operating margin Capacity reservation fees Mix & price Unused capacity charges Manufacturing reshaping & Net Operating Leverage Operating margin in 2024 & efficiency Opex base resizing in 2027-28 Unused capacity charges & efficiency, cost base
Slide 17: Capital intensity is expected to decrease
Capital intensity is expected to decrease We are in a position to leverage the significant investments in the infrastructure done in the last few years 30% Net Capex / Net Revenues (%) Main investments 2024-27 Capacity & mix Changes 25% Average 2022-24: ~21% • Agrate and Crolles 300mm 20% Average •
Slide 18: Investment & capital allocation
Investment & capital allocation Market-driven R&D based on leading-edge products and technologies Commitment to Accelerate R&D investment on critical success areas: wide bandgap materials, innovation and growth Edge AI, Silicon Photonics, Cloud-Connected Autonomous Things… Commitment to organic and
Slide 19: Key takeaways
Key takeaways $20B+ Ambition and attendant financial model is still valid but postponed Intermediate model with revenues expected at ~$18B in 2027 / 2028 ST has the right innovation capabilities, product portfolio, & end-market exposure to achieve this target Gross Margin expected in a 44-46% range
Slide 20: APPENDIX
APPENDIX
Slide 21: Currency impact
Currency impact Revenues 10% 90% 89% COGS 32% 68% 68% OPEX 71% 71% 29% Euro USD Quarterly effect of +/-1% change of €/$: -/+ $8M to $10M on Operating Income Euro / USD weights based on 9-months year to date for FY24
Slide 22: Appendix
Appendix • Net financial position and Adjusted Net Financial Position (non-U.S. GAAP measure): represents the difference between our total liquidity and our total financial debt. Our total liquidity includes cash and cash equivalents, restricted cash, if any, short-term deposits, and marketable secu
Slide 23: Find out more at www.st.com
Find out more at www.st.com © STMicroelectronics - All rights reserved. ST logo is a trademark or a registered trademark of STMicroelectronics International NV or its affiliates in the EU and/or other countries. www.st.com/trademarks For additional information about ST trademarks, please refer to ww