Geneva-based STMicroelectronics on Thursday predicted a healthy financial outlook for the full year, prompting a 7% bump in its stock price.
For the third quarter, the company saw a 1.2% increase in net revenues compared to a year ago but posted an 18% decline in net income.
CEO Jean-Marc Chery called the company’s auto and industrial segment “soft” but noted that third quarter revenues were up 17% from the prior quarter.
He predicted the fourth quarter revenues will grow by 5% over the third quarter, or about 1.2% over the final quarter of 2018. Revenues for all of 2019 are anticipated to reach $9.48 billion with a double-digit operating margin.
The full year forecast provoked investors to buy the stock in early trading on the NYSE, prompting a 7.5% surge in the stock price to $22.04.
STMicroelectronics makes a wide range of electronics products used by 100,000 customers globally. It recently began shipping samples of its next-gen system-on-chip for electronic payments called STPay-Topaz.
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Net revenue for the third quarter was $2.553 billion, up from $2.522 billion in the same quarter a year ago. Net income was $302 million, down 18% from $369 million a year earlier.
The company said it recorded higher sales in products for imaging, analog, power discrete and MEMS, which were largely offset by lower sales for digital integrated circuits, automotive and microcontroller sales.
Auto is folded into power discrete in the way the company reports revenues by product group, so while auto declined, power discrete improved although exact figures were not reported. However, when combined, the auto and power discrete group saw a big operating profit decline of 34.5% to $76 million.