Slide 1: STMicroelectronics Q2 2020 Financial Results
STMicroelectronics Q2 2020 Financial Results July 23, 2020
Slide 2: Forward looking information
Forward looking information Some of the statements contained in this release that are not historical facts are statements of future expectations and other forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933 or Section 21E of the Securities Exchange Act of 1934
Slide 3: Highlights
Highlights • We returned to normal operations, supporting our customers’ demand and continuing to ensure the health and safety of our employees • Net revenues were $2.09B, decreasing sequentially 6.5%. As expected, this was due to a decline in Automotive, Analog and Imaging Q2 products, partially of
Slide 4: Q2 2020 Financial highlights
Q2 2020 Financial highlights Revenues = $2.09B Operating Margin = 5.1% 2.5 15% 2.0 10% 1.5 5% 1.0 0% Q219 Q120 Q220 Q219 Q120 Q220 Gross Margin = 35.0% Net Income = $90M 40% 200 38% 36% 100 34% 32% 30% 0 Q219 Q120 Q220 Q219 Q120 Q220 4
Slide 5: H1 2020 Financial highlights
H1 2020 Financial highlights Revenues = $4.32B Operating Margin = 7.8% 4.5 10% 4.0 5% 3.5 3.0 0% H119 H120 H119 H120 Gross Margin = 36.5% Net Income = $282M 40% 400 38% 300 36% 200 34% 100 32% 30% 0 H119 H120 H119 H120 5
Slide 6: Q2 2020 Revenues
Q2 2020 Revenues % by product group % by shipment location % by region of origin Americas Americas Asia 12% Pacific Others 34% 0.1% EMEA 18% 43% Analog, MEMS & Automotive & Sensors Group Discrete Group 70% (AMS) (ADG) Asia 23% Pacific 30% 35% EMEA % by customer type 35% Distribution 34% 40% Top 10 O
Slide 7: Revenues
Revenues Q220 Revenues = $2.09B 3.0 Q220 revenues down 4.0% Y/Y • The Company recorded lower sales in Imaging, Automotive, and 2.5 MEMS, partially offset by higher sales in Microcontrollers, Digital, Analog and Power Discrete; 2.0 • Revenues to Distribution increased 9.7% and to OEMs decreased 9.7%.
Slide 8: Gross margin
Gross margin Q220 Gross Margin = 35.0% 40% Q220 Gross Margin • Down 320 bps Y/Y mainly due to unsaturation charges, 38% including the impact of COVID-19 workforce related restrictions, and price pressure; 36% • Down 290 bps Q/Q; • 40 bps higher than the mid-point of the Company’s 34% guidance, as un
Slide 9: Net operating expenses
Net operating expenses (*) Q220 Net Operating Expenses = $620M 650 35% Combined SG&A and R&D at $632M • 30.3% of revenues. 30% 600 25% 550 Q220 Net Operating Expenses at $620M 20% • We are maintaining a strict discipline on controlling 500 expenses while protecting our R&D, sales & marketing 15% pro
Slide 10: Q2 2020 Product group results
Q2 2020 Product group results Automotive & Discrete Analog, MEMS & Sensors Microcontrollers & Digital ICs (ADG) (AMS) (MDG) Revenues = $727M Revenues = $624M Revenues = $733M Operating Margin = 2.3% Operating Margin = 9.0% Operating Margin = 15.9% 1,250 30% 1,250 30% 1,250 30% 1,000 1,000 1,000 20%
Slide 11: Financial flexibility
Q2 2020 Financial flexibility Net Cash From Operating Free Cash Flow* = $28M Capex= $312M Activities = $387M 800 500 400 Capex / sales (%) 18% 400 16% 600 300 300 14% 400 200 200 12% 100 200 100 0 10% 0 -100 0 8% Q219 Q319 Q419 Q120 Q220 Q219 Q319 Q419 Q120 Q220 Q219 Q319 Q419 Q120 Q220 • Cash divid
Slide 12: Solid capital structure
Solid capital structure ST is in a solid position from a capital, liquidity and balance sheet perspective June 27 March 28 June 29 End of period (US$M) 2020 2020 2019 Total Liquidity 2,621 2,710 2,512 Total Financial Debt (2,051) (2,042) (2,204) Net Financial Position* 570 668 308 • Unutilized commi
Slide 13: Q2 2020 Supply chain situation
Q2 2020 Supply chain situation During the second quarter, we returned to normal operations, supporting our customers’ demand and continuing to ensure the health and safety of our employees. These have been our priorities since the start of the pandemic. • In preparation for the return of all our emp
Slide 14: Q2 2020 Automotive highlights
Q2 2020 Automotive highlights ADG New design wins for Silicon Carbide MOSFETs - in a traction inverter and in an on-board charger and DC/DC converter for electric vehicles. ADG Design win for a battery management system for e-bikes. Awards for our 28nm Phase Change Memory microcontrollers (Stellar)
Slide 15: Q2 2020 Industrial highlights
Q2 2020 Industrial highlights MDG Signed agreements to further strengthen the wireless connectivity Industrial capabilities of our STM32 MCUs with Narrow Band Cellular and UWB. MDG STM32 Ecosystem development: Digital Power Ecosystem, tools from partners for simple Machine Learning, and functional-s
Slide 16: Q2 2020 Personal electronics highlights
Q2 2020 Personal electronics highlights MDG Won RF mixed-signal projects and integrated passive RF solutions in Personal Electronics ADG Front-End Modules for 5G smartphones. Won designs in flagship smartphones including 5G models with MEMS AMS motion sensors and time-of-flight ranging sensors. Awar
Slide 17: Q2 2020 Communications equipment, computers & peripherals highlights
Q2 2020 Communications equipment, computers & peripherals highlights Communications Equipment, Computers & Peripherals MDG Awarded designs using ST proprietary technologies for a processor for a satellite application. MDG Won several RF projects for telecommunication infrastructure. 17
Slide 18: Q3 2020 Outlook
Q3 2020 Outlook Net revenues are expected to be $2.45B, a growth of 17.4% sequentially, plus or minus 350 basis points. Gross Margin of 36.0%, plus or minus 200 basis points. This outlook is based on an assumed effective currency exchange rate of approximately $1.12 = €1.00 for the 2020 third quarte
Slide 19: FY 2020 Sales and operating plan
FY 2020 Sales and operating plan We will drive the Company based on an updated plan for FY20 net revenues in the range of about $9.25B to $9.65B. • We plan for growth in H2 over H1 in the range of $610M to $1.01B, driven by engaged customer programs, new products and improved market conditions. • Th
Slide 20: Takeaways
Takeaways While we continue to ensure the ongoing health and safety of all our employees in response to the global pandemic, during last quarter we have returned to normal operations. ST fundamentals are solid. The strategic decisions which we made years ago have enabled us to successfully serve sec
Slide 21: Appendix
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Slide 22: Historical financial performance
Historical financial performance 22 In US$M, except EPS Q119 Q219 H119 Q319 Q419 FY19 Q120 Q220 H120 Net Revenues 2,076 2,173 4,249 2,553 2,754 9,556 2,231 2,087 4,318 Gross Margin 39.4% 38.2% 38.8% 37.9% 39.3% 38.7% 37.9% 35.0% 36.5% Operating Income 211 196 408 336 460 1,203 231 106 337 Operating
Slide 23: Appendix
Appendix • Net financial position (non-U.S. GAAP measure): represents the difference between our total liquidity and our total financial debt. Our total financial resources include cash and cash equivalents, marketable securities, restricted cash and short-term deposits, and our total financial debt
Slide 24: Thank you
Thank you © STMicroelectronics - All rights reserved. The STMicroelectronics corporate logo is a registered trademark of the STMicroelectronics group of companies. All other names are the property of their respective owners.