Switzerland-based chipmaker STMicroelectronics (ST) released its fourth-quarter and fiscal 2022 financial results on January 26, 2023.The company reported fourth quarter net revenues of US$4.42 billion, gross margin of 47.5%, operating margin of 29.1%, and net income of US$1.25 billion.
The US$4.42 billion net revenues represented a year-over-year increase of 24.4%. On a year-over-year basis, ST recorded higher net sales in the Automotive and Discrete Group (ADG) and Microcontrollers and Digital ICs Group (MDG), but the Analog, MEMS and Sensors Group (AMS) saw decreased net sales. In fourth-quarter 2022, ADG accounted for 39% of revenues, MDG acounted for 31%, and AMS for 30%. For FY2022, the revenue share was 37%, 32% and 31% for ADG, MDG and AMS, respectively.
By geography, 61% of STMicroelectronics' shipment went to Asia Pacific in Q4, 24% went to the EMEA (Europe, Middle East, Africa) region, and 15% went to Americas. For FY 2022, the distribution was 63%, 23%, 14% for Asia Pacific, EMEA and Americas.
Inventory at the end of Q4 was US$2.58 billion, compared to US$1.97 billion in the year-ago quarter. Days sales of inventory at quarter-end was 101 days compared to 91 days in the year-ago quarter.
FY 2022 revenue increase driven by strong automotive applications
For fiscal 2022, net revenues reached US$16.13 billion, with gross margin at 47.3%; operating margin at 27.5%; and net income was US$3.96 billion.
Jean-Marc Chery, STMicroelectronics President & CEO, remarked that the Q4 revenues and gross margin were above the mid-point of the guidance, while the FY 2022 revenue increase of 26.4% was driven by strong demand in automotive and industrial applications. In FY 2022, ST saw operating margin increased to 27.5% from 19.0% in FY 2021 and net income almost doubled to $3.96 billion. The chipmaker invested US$3.52 billion in CAPEX while delivering free cash flow of US$1.59 billion.
Regarding 2023, Chery indicated that ST planned to invest about US$4.0 billion in CAPEX, mainly to increase 300mm wafer fabs and silicon carbide (SiC) manufacturing capacity, including ST's substrate initiative. "Based on our strong customer demand and increased manufacturing capacity, we will drive the company based on a plan for FY 2023 revenues in the range of $16.8 billion to $17.8 billion," said Chery.
Overall, ST's guidance for 2023 at the midpoint expects net revenues to be US$4.20 billion, a decrease of 5.1% sequentially. Gross margin us expected at 48.0%, plus or minus 200 basis points.