STMicroelectronics N.V. (“ST”) (NYSE: STM), a global semiconductor leader serving customers across the spectrum of electronics applications, reported U.S. GAAP financial results for the first quarter ended March 28, 2026. This press release also contains non-U.S. GAAP measures (see Appendix for additional information).
ST reported first quarter net revenues of $3.10 billion, gross margin of 33.8%, operating income of $70 million, and net income of $37 million or $0.04 diluted earnings per share (non-U.S. GAAP1 gross margin of 34.1%, non-U.S. GAAP1 operating income of $171 million, and non-U.S. GAAP1 net income of $122 million or $0.13 diluted earnings per share).
Jean-Marc Chery, ST President & CEO, commented:
- “Q1 net revenues, excluding the contribution of our acquisition of NXP’s MEMS sensor business, came above the mid-point of our business outlook range, driven mainly by higher revenues in our engaged customer programs in Personal electronics and CECP. Gross margin was above the mid-point of our business outlook range mainly due to better product mix.”
- “On a year-over-year basis, Q1 net revenues increased 23.0%; excluding the contribution of our acquisition of NXP’s MEMS sensor business, they increased 21.4%. Q1 gross margin was 33.8%, operating margin was 2.3% and net income was $37 million. On a non-U.S. GAAP1 basis gross margin was 34.1%, operating margin was 5.5% and net income was $122 million.”
- “In Q1, despite the macroeconomic uncertainty, we saw improving demand with strong booking and normalized inventory in distribution.”
- “Our second quarter business outlook, at the mid-point, is for net revenues of $3.45 billion, increasing 11.6% sequentially and 24.9% year-over-year. Gross margin is expected to be about 34.8%, including about 100 basis points of unused capacity charges. Non-U.S. GAAP1 gross margin is expected to be about 35.2%.”
- “ST is now strategically positioned to capture upside from new AI driven programs, leveraging specialized technologies to enable the evolving AI infrastructure, confirming our datacenters revenue expectation to be nicely above $500 million for 2026 and well above $1 billion for 2027.”
Quarterly Financial Summary
| U.S. GAAP (US$ m, except per share data) | Q1 2026 | Q4 2025 | Q1 2025 | Q/Q | Y/Y |
| Net Revenues | $3,095 | $3,329 | $2,517 | -7.0% | 23.0% |
| Gross Profit | $1,045 | $1,172 | $841 | -10.9% | 24.3% |
| Gross Margin | 33.8% | 35.2% | 33.4% | -140bps | 40bps |
| Operating Income | $70 | $125 | $3 | -43.8% | 2,327.6% |
| Operating Margin | 2.3% | 3.8% | 0.1% | -150bps | 220bps |
| Net Income (Loss) | $37 | $(30) | $56 | – | -33.7% |
| Diluted Earnings Per Share | $0.04 | $(0.03 | $0.06 | – | -33.3% |
1 Non-U.S. GAAP. See Appendix for reconciliation to U.S. GAAP and information explaining why the Company believes these measures are important.
| Non-U.S. GAAP1 (US$ m, except per share data) | Q1 2026 | Q4 2025 | Q1 2025 | Q/Q | Y/Y |
| Gross Profit | 1,056 | 1,172 | 841 | -10.0% | 25.5% |
| Gross Margin | 34.1% | 35.2% | 33.4% | -110bps | 70bps |
| Operating Income | $171 | $266 | $11 | -35.7% | 1,454.5% |
| Operating Margin | 5.5% | 8.0% | 0.4% | -250bps | 510bps |
| Net Income | $122 | $100 | $63 | 22.0% | 93.7% |
| Diluted Earnings Per Share | $0.13 | $0.11 | $0.07 | 18.2% | 85.7% |
First Quarter 2026 Summary Review
| Net Revenues by Reportable Segment1 (US$ m) | Q1 2026 | Q4 2025 | Q1 2025 | Q/Q | Y/Y |
|---|---|---|---|---|---|
| Analog products, MEMS and Sensors (AM&S) segment | 1,318 | 1,449 | 1,069 | -9.1% | 23.2% |
| Power and discrete products (P&D) segment | 389 | 412 | 397 | -5.4% | -1.8% |
| Subtotal: Analog, Power & Discrete, MEMS and Sensors (APMS) Product Group | 1,707 | 1,861 | 1,466 | -8.3% | 16.4% |
| Embedded Processing (EMP) segment | 975 | 1,015 | 742 | -4.0% | 31.3% |
| RF & Optical Communications (RFOC) segment | 409 | 449 | 306 | -9.0% | 33.9% |
| Subtotal: Microcontrollers, Digital ICs and RF products (MDRF) Product Group | 1,384 | 1,464 | 1,048 | -5.5% | 32.1% |
| Others | 4 | 4 | 3 | — | — |
| Total Net Revenues | 3,095 | 3,329 | 2,517 | -7.0% | 23.0% |
Net revenues totaled $3.10 billion, representing a year-over-year increase of 23.0%. Net revenues included about $40 million revenues associated with NXP’s MEMS sensor business; excluding this contribution net revenues increased 21.4% on a year-over-year basis. Year-over-year net sales to OEMs and Distribution increased 24.5% and 19.2%, respectively. On a sequential basis, net revenues decreased 7.0% and 8.2% excluding NXP’s MEMS sensor business contribution, 50 basis points better than the mid-point of ST’s guidance.
Gross profit totaled $1.05 billion, representing a year-over-year increase of 24.3%. Gross margin of 33.8%, increased 40 basis points year-over-year, mainly due to lower unused capacity charges and better product mix. Gross profit included $11 million Purchase Price Allocation (PPA) effects from the acquisition of NXP’s MEMS sensor business. Non-U.S. GAAP1 Gross Margin, excluding this item, was 34.1%. Excluding the impact from NXP’s MEMS sensor business and related PPA effects, gross margin stood at 33.9%, 20 basis points better than the mid-point of ST’s guidance.
Operating income increased from $3 million in the year-ago quarter to $70 million. ST’s operating margin increased on a year-over-year basis to 2.3% of net revenues, compared to 0.1% in the first quarter of 2025. Operating income included $71 million impairment, restructuring charges and other related phase-out costs for the quarter, mainly reflecting charges related to the execution of the previously announced company-wide program to reshape our manufacturing footprint and resize our global cost base and $30 million Purchase Price Allocation (PPA) effects from the acquisition of NXP’s MEMS sensor business. Excluding these items, non-U.S. GAAP1 Operating income stood at $171 million in the first quarter (or 5.5% non-U.S. GAAP1 operating margin).
By reportable segment, compared with the year-ago quarter:
In Analog, Power & Discrete, MEMS and Sensors (APMS) Product Group:
Analog products, MEMS and Sensors (AM&S)2 segment:
- Revenue increased 23.2% mainly due to Imaging and MEMS and, to a lesser extent, Analog.
- Operating profit increased by 95.8% to $161 million. Operating margin was 12.2% compared to 7.7%.
1 Non-U.S. GAAP. See Appendix for reconciliation to U.S. GAAP and information explaining why the Company believes these measures are important.
2 Q126 revenues associated with NXP’s MEMS sensor business were allocated to Analog products, MEMS and Sensors (AM&S) segment.
Power and Discrete products (P&D) segment:
- Revenue decreased 1.8%.
- Operating result decreased from a loss of $28 million to a loss of $84 million. Operating margin was -21.5% compared to -6.9%.
In Microcontrollers, Digital ICs and RF products (MDRF) Product Group:
Embedded Processing (EMP) segment:
- Revenue increased 31.3% due to General Purpose MCU and, to a lesser extent, Custom Processing.
- Operating profit increased by 148.7% to $164 million. Operating margin was 16.9% compared to 8.9%.
RF & Optical Communications (RFOC) segment:
- Revenue increased 33.9%.
- Operating profit increased by 43.4% to $61 million. Operating margin was 14.9% compared to 13.9%.
Net income and diluted Earnings Per Share decreased to $37 million and $0.04 respectively, compared to $56 million and $0.06 respectively in the year-ago quarter. In the first quarter of 2026 non-U.S. GAAP1 Net income stood at $122 million and non-U.S. GAAP1 diluted Earnings Per Share stood at $0.13.
Cash Flow and Balance Sheet Highlights
| Trailing 12 Months | ||||||
|---|---|---|---|---|---|---|
| (US$ m) | Q1 2026 | Q4 2025 | Q1 2025 | Q1 2026 | Q1 2025 | TTM Change |
| Net cash from operating activities | 534 | 674 | 574 | 2,111 | 2,680 | -21.2% |
| Free cash flow (non-U.S. GAAP¹) | (723)² | 257 | 30 | (488) | 453 | – |
Net cash from operating activities was $534 million in the first quarter, including about $45 million outflow related to restructuring, compared to $574 million in the year-ago quarter, which benefitted from a positive $147 million inflow from net working capital.
Net Capex (non-U.S. GAAP1 ), was $362 million in the first quarter compared to $530 million in the year-ago quarter.
Free cash flow (non-U.S. GAAP1 ) was negative at $723 million in the first quarter compared to positive $30 million in the year-ago quarter. Free cash flow included $895 million cash-out related to the payment for the acquisition of NXP’s MEMS sensor business.
Inventory at the end of the first quarter was $3.17 billion, compared to $3.14 billion in the previous quarter and $3.01 billion in the year-ago quarter. Days sales of inventory at quarter-end was 140 days, compared to 130 days for the previous quarter and 167 days for the year-ago quarter.
In the first quarter, ST paid cash dividends to its stockholders totaling $71 million.
ST’s net financial position (non-U.S. GAAP1 ) remained strong at $2.00 billion as of March 28, 2026, compared to $2.79 billion as of December 31, 2025, and reflected total liquidity of $4.57 billion and total financial debt of $2.57 billion. Adjusted net financial position (non-U.S. GAAP1 ), taking into consideration the effect on total liquidity of advances from capital grants for which capital expenditures have not been incurred yet, stood at $1.69 billion as of March 28, 2026.
Corporate developments
On February 2, 2026, ST completed the acquisition of NXP’s MEMS sensor business. Announced in July 2025, this transaction focused on automotive safety and non-safety products and sensors for industrial applications, expands ST’s global sensors capabilities.
1 Non-U.S. GAAP. See Appendix for reconciliation to U.S. GAAP and information explaining why the Company believes these measures are important.
2 Q126 Free cash flow includes $895 million cash-out related to the acquisition of NXP MEMS sensor business.
On February 9, 2026, ST announced an expanded strategic collaboration with Amazon Web Services (AWS) through a multi-year, multi-billion USD commercial engagement to enable new high performance compute infrastructure for cloud and AI data centers. This engagement covers a broad range of semiconductor solutions leveraging ST’s portfolio of proprietary technologies. ST has issued warrants to AWS for up to 24.8 million ordinary shares of ST. The warrants will vest in tranches over the term of the agreement, with vesting substantially tied to payments for ST products and services by AWS and its affiliates.
Business Outlook
ST’s guidance, at the mid-point, for the 2026 second quarter is:
- Net revenues are expected to be $3.45 billion, an increase of 11.6% sequentially, plus or minus 350 basis points.
- U.S. GAAP Gross margin of 34.8%, plus or minus 200 basis points. Non-U.S. GAAP1 gross margin is expected to be about 35.2%, plus or minus 200 basis points.
- This outlook is based on an assumed effective currency exchange rate of approximately $1.15 = €1.00 for the 2026 second quarter and includes the impact of existing hedging contracts.
- The second quarter will close on June 27, 2026.
This business outlook does not include any impact of potential further changes to global trade tariffs compared to the current situation.
Conference Call and Webcast Information
This press release contains supplemental non-U.S. GAAP financial information.
Readers are cautioned that these measures are unaudited and not prepared in accordance with U.S. GAAP and should not be considered as a substitute for U.S. GAAP financial measures. In addition, such non-U.S. GAAP financial measures may not be comparable to similarly titled information from other companies. To compensate for these limitations, the supplemental non-U.S. GAAP financial information should not be read in isolation, but only in conjunction with ST’s consolidated financial statements prepared in accordance with U.S. GAAP.
See the Appendix of this press release for a reconciliation of ST’s non-U.S. GAAP financial measures to their corresponding U.S. GAAP financial measures.
For more Information visit: www.st.com.
