Geneva-based ST Microelectronics reported preliminary third quarter net revenues of $2.67 billion on Thursday, above its earlier predicted outlook range, due to what it called “significantly better than expected market conditions.”
“Sharp acceleration in demand of automotive products and microcontrollers, as well as our engaged customer programs in personal electronics, were the main factors that contributed to the result,” said CEO Jean-Marc Chery in a statement.
More details will be provided during an earnings call on Oct. 22. The company’s stock is traded on the New York Stock Exchange, It closed at $30.69 on Wednesday but rose by more than 6% in early hours trading Thursday to 32.64.
The preliminary report of net revenues reaching $2.67 billion compares to a prior outlook announced in July of $2.45 billion. The $2.67 billion is also up nearly 28% over second quarter net revenues of $2.09 billion.
The preliminary result is also a 4.7% improvement over a year ago when third quarter net revenues were $2.55 billion.
STMicroelectronics expects to finish 2020 with revenues above $9.65 billion, ahead of its 2019 finish of $9.556. The company designs and manufactures a range of semiconductors for 100,000 customers and employs about 46,000 designers and other workers.
In 2019, STMicroelectronics ranked 8th in total revenues globally, behind 7th ranked Texas Instruments, with more than $14 billion in revenues.
The improvement for STMicroelectronics comes amid a year of historic uncertainty including the COVID-19 pandemic and widespread economic turmoil. Semiconductors stocks have generally done better than many industrial sectors since March, however. The Philadelphia Semiconductor Index of prominent companies rose to $2,244 on Wednesday, up from its 2020 low of $1,286 on March 18 when the coronavirus was first seen as a global pandemic.
In September, home sales were booming but the tech-heavy Nasdaq market dropped nearly 5% amid a positive third quarter, leading to some investor fears. However, a few investors are remaining optimistic for the fourth quarter including Jim Paulsen of Leuthold Group who told CNBC on Wednesday that he sees “incredible economic momentum” in the fourth quarter.