STMicroelectronics Clocks 35% Revenue Growth In Q3 Backed By All Its Segments; Margins Expand

STMicroelectronics NV (NYSE: STM) reported third-quarter FY22 revenue growth of 35.2% year-on-year to $4.32 billion, beating the consensus of $4.24 billion.
Sales to OEMs increased by 34.1% Y/Y, and Distribution sales improved by 37.4% Y/Y.
Automotive and Discrete Group (ADG) revenue rose 55.5% Y/Y to $1.56 billion. Analog, MEMS, and Sensors Group (AMS) revenue increased by 9.7% Y/Y to $1.38 billion. Microcontrollers and Digital ICs Group (MDG) revenue grew 47.7% Y/Y to $1.37 billion.
Margins: The gross margin expanded 600 bps to 47.6%. Improved product mix and favorable pricing drove the margin.
The operating margin expanded by 1,050 bps to 29.4%.
EPS of $1.16 beat the consensus of $1.04.
STMicroelectronics generated $676 million in free cash flow and held $4.09 billion in cash and equivalents.
Outlook: STMicroelectronics sees Q4 revenue at the mid-point of $4.40 billion, up 23.7% Y/Y.
STMicroelectronics sees FY22 revenue at the mid-point of $16.10 billion, up 26.2% Y/Y.
Price Action: STM shares traded lower by 6.39% at $32.37 in the premarket on the last check Thursday.
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