STMicro reported third-quarter revenue of $3.19 billion on Thursday and told investors it expects that number to surge to $3.28 billion in the fourth quarter.
The company says rising orders from clients like Tesla and Apple are driving the growth. CEO Jean-Marc Chery said the focus is on “accelerating innovation” and “reshaping our manufacturing footprint.”
The projection still falls short of analyst expectations. According to a poll by LSEG, Wall Street was looking for $3.34 billion in Q4 sales and $3.12 billion in Q3.
Even so, STMicro is showing some signs of recovery in markets that have been wrecked since COVID: consumer electronics, auto, and industrial chips.
STMicro reduces 2025 capex while continuing chip supply for Apple and Tesla
While Texas Instruments on Wednesday spooked the market with a gloomy Q4 outlook, STMicro took a different tone, though it’s not throwing money around either.
The company quietly slashed its 2025 capital expenditure plan to “slightly below $2 billion,” down from its previous range of $2 to $2.3 billion. It blamed “current market conditions” but didn’t give much detail beyond that.
STMicro also gave a nod to its cost-cutting program, saying it “remains on schedule” even after some pushback in Italy. The plan has faced labor resistance in the country, but it seems STMicro is pushing forward regardless.
Meanwhile, the firm’s clients are preparing for big chip transitions of their own. Apple is expected to roll out its first 2-nanometer chip, the A20, inside next year’s iPhone 18. This would replace the current 3-nanometer chips Apple uses, which are based on TSMC’s older node. The A20 will also be the base for the new M6 series chips used in Macs.
TSMC has already warned partners, including Apple, that the price for this new chip won’t be cheap. Costs are expected to jump by at least 50% compared to the 3-nanometer units.
High upfront spending on the new manufacturing node and low yields are part of the reason. Suppliers expect the chip could cost around $280 per unit, which would make it the most expensive component inside the iPhone. Apple will either eat that margin or pass the cost to buyers.
Over at Tesla, Cryptopolitan reported that CEO Elon Musk’s custom AI chip, called AI5, will be manufactured by both Samsung in Texas and TSMC in Arizona.
“Our explicit goal is to have an oversupply of AI5 chips,” Elon told investors. “Any chips not used in cars or robots can be used in our data centers.”
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