FONT-SIZE Plus   Neg

STMicroelectronics To Quit ST-Ericsson - Quick Facts

STMicroelectronics (STM) announced its new strategic plan, an outcome of a strategic review started over a year before, as the company witnessed major changes in the dynamics of the wireless market. Owing to the major changes in the dynamics of the wireless market, the company has decided to exit ST-Ericsson after a transition period and is currently in talks on exit options, while it would continue supporting ST-Ericsson as their supply-chain partner, advanced process-technology partner and application-processor IP provider. This disengagement process has begun, with the transition expected to end during the third quarter of 2013.

According to Carlo Bozotti, President and CEO of ST, "The new ST will be more focused, leaner and better positioned to deliver value to our customers and our shareholders, targeting to rapidly achieve operating margins of 10 percent."

The company's new strategy is based on two product-segment organizations namely Sense & Power and Automotive Products; and Embedded Processing Solutions. ST said it would build on its position in Sense & Power, comprosing MEMS and sensors, power discrete and advanced analog products, and in Automotive Products, from powertrain to safety, and from body to infotainment. In Embedded Processing Solutions, the company would concentrate on the core of the electronics systems rather than on wireless broadband access.

ST would address an estimated $140 billion market in 2013 and has significant potential to grow and gain market share. Looking ahead, ST aims for an operating margin of 10 percent or more. Also, ST expects to reduce quarterly net operating expenses to an average quarterly rate in the range of $600 million - $650 million by the beginning of 2014, in order to achieve the new financial model.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Quick Facts

Editors Pick
Shares of Orange SA (ORAN) were gaining around 5 percent in the morning trading in Paris after the French telecom major reported higher restated EBITDA, a key earnings metric, in its third quarter with slightly higher sales. This was despite weakness in its domestic market. Further, the company maintained its fiscal 2016 forecast of restated EBITDA to be greater than last year, on a comparable bas Swiss drug giant Novartis AG reported Tuesday higher net profit in its third quarter, while sales were weak due to generic competition and pricing. Core earnings per share topped analysts' estimates, but sales missed their view. For fiscal 2016, the company continues to expect Core operating income to be broadly in line or decline low-single digit, and net sales to be broadly in line.. Social media site Twitter Inc., which is facing an uncertain future, is planning to cut around 8 percent of its total workforce, Bloomberg reported Monday citing people familiar with the matter. The company, which is trying cost control amid slowing sales growth, may announce the job cut of about 300 people as soon as this week.
comments powered by Disqus
Follow RTT