St. Louis soars after accounts, guidance above estimates and good AI numbers

(Il Sole 24 Ore Radiocor) - A banner session for Stmicroelectronics , which published its first-quarter accounts, appreciated by the market and analysts, especially with regard to the outlook, which was better than expected, and the prospects for artificial intelligence. The share price, which started immediately on the rise, gradually accelerated until it came to a halt due to overbought, with a top of the day at EUR 41.15, levels not seen since June 2024 (although still a long way from the record of EUR 50.48 reached in July 2023). The positive progression of the period therefore continued, with +9% in the last week, +40% in the last month, +70% so far in 2026 and +106.9% in the last year.

Although profit was lower than expected, but still a turnaround from the fourth quarter loss, revenue and gross margins exceeded company and consensus forecasts, driven mainly by higher revenues in ongoing programmes with our customers in Personal Electronics and Cecp (Communication Equipment and Computer Peripherals).

The expectations for the second quarter are also higher than estimates: St. Louis expects net revenues of USD 3.45 billion (+11.6% compared to the previous quarter and +24.9% year-on-year), with a gross margin of around 34.8%, while analysts see revenues of USD 3.183 billion and a gross margin of 34.4% (in the first quarter, revenues were USD 3.095 billion and gross margin was 33.8%). "The guidance for the second quarter 2026 is higher than expected. The company has improved the outlook on artificial intelligence (around 6% of 2027 revenues),' point out Intermonte analysts. Indeed, the semiconductor group is betting on AI, and is ready to ride the wave of what appears to be the driving force of the entire sector. "St is now strategically positioned to reap the benefits from new programmes driven by artificial intelligence, leveraging specialised technologies to enable the evolution of the infrastructure for AI," said the Ceo, Jean-Marc Chery.

The company expects data centre-related revenues to be 'easily above' USD 500 million by 2026 and 'well above' USD 1 billion by 2027. And it is precisely on AI that investors' attention is focused, as noted by Morningstar analysts, according to whom "the numbers for the AI-related business are the analysts' special watch. The semiconductor sector is experiencing a golden moment, thanks to strong demand from hyperscalers who require state-of-the-art chips to power their artificial intelligence infrastructure'.

Looking at the numbers, in the first quarter St reported anet profit of USD 37 million, compared to a profit of USD 56 million in the same period of 2025 and a net loss of USD 30 million in the previous three months. Adjusted (non-gaap) profit for the quarter was $122 million, up 93.7% year-on-year and 22% over the previous three months. revenues rose 23% year-on-year (down 7% quarter-on-quarter) to $3.095 billion, compared to the company's estimate of $3.04 billion. Analysts' consensus was for a profit of 128 million on revenues of 3.037 billion. Gross margin stood at 33.8 per cent for the quarter, compared to 33.4 per cent for the same period in 2025 and 33.7 per cent expected by the consensus. For the first quarter, the group expected a figure of around 33.7%. "Despite macroeconomic uncertainty, Q1 St saw animprovement in demand with sustained order bookings and inventory normalisation in distribution," Chery said.