STMicroelectronics announced its 2022 fiscal year results: it plans to spend $4 billion in capital expenditures this year to increase production capacity

Switzerland-based chipmaker STMicroelectronics (ST) released its financial results for the fourth quarter and fiscal year 2022 on January 26, 2023, Digitimes reported. The company reported fourth-quarter net income of $4.42 billion, gross margin of 47.5%, operating margin of 29.1%, and net income of $1.25 billion.

STMicroelectronics net income of 4.42 billion US dollars last year, an increase of 24.4%. Compared with the same period last year, STMicroelectronics' net sales in the Automotive and Discrete Group (ADG) and Microcontrollers and Digital IC Group (MDG) increased, but the Analog, MEMS and Sensors Group (AMS) net sales decreased. In the fourth quarter of 2022, ADG accounted for 39% of revenue, MDG accounted for 31%, and AMS accounted for 30%. In FY2022, ADG, MDG, and AMS have revenue shares of 37%, 32%, and 31%, respectively.

Geographically, 61% of STMicroelectronics' fourth-quarter shipments were shipped to the Asia-Pacific region, 24% to the EMEA (Europe, Middle East, Africa) region, and 15% to the Americas. In fiscal year 2022, the distributions in Asia Pacific, Europe, Middle East and Africa and America are 63%, 23% and 14% respectively.

Inventory at the end of the fourth quarter was $2.58 billion, compared with $1.97 billion a year earlier. Days of inventory sold at quarter-end was 101 days, compared to 91 days a year earlier.

Strong automotive applications drive revenue growth in FY2022

In fiscal year 2022, the net revenue is 16.13 billion US dollars, the gross profit margin is 47.3%; the operating profit margin is 27.5%; the net income is 3.96 billion US dollars.

President and CEO Jean-Marc Chery said fourth-quarter revenue and gross margin were above the midpoint of guidance, while fiscal 2022 revenue growth of 26.4% was driven by strong demand from automotive and industrial applications. In fiscal 2022, ST's operating margin rose to 27.5% from 19.0% in fiscal 2021, and net income nearly doubled to $3.96 billion. The chipmaker invested $3.52 billion in CAPEX while delivering $1.59 billion in free cash flow.

For 2023, Chery said that ST plans to invest about US$4 billion in CAPEX, mainly to increase 300mm fab and silicon carbide (SiC) capacity, including ST's substrate plan. "Based on our strong customer demand and increased manufacturing capacity, we will drive the company forward based on our fiscal 2023 revenue plan in the range of $16.8 billion to $17.8 billion," Chery said.

Overall, ST's 2023 midpoint guidance sees net revenue of $4.2 billion, down 5.1% sequentially. We expect gross margin to be 48.0%, plus or minus 200 basis points.