STMicroelectronics N.V. Q3 2026 Earnings Recap

ST shares fell 3.7% despite Q3 revenue and gross margin coming in above the midpoint of the company’s outlook. The likely concern is that investors focused on the outlook and durability of growth: the transcript cites a 2026 AI-datacenter revenue expectation and a 2027 ambition, but the provided excerpt does not include the company’s full Q4 guidance.

Key Takeaways

• Q3 net revenue was $3.76 billion; gross margin was 37.3%, and non-U.S. GAAP diluted EPS was $0.37.
• Revenue growth was led by Communication Equipment and Computer Peripheral, up 64% year over year, and Industrial, up 40%; Automotive rose 5%, while Personal Electronics fell 4%.
• Management said bookings increased sequentially and book-to-bill remained well above 2 overall, with distribution inventory below its standard target.
• AI-datacenter revenue was expected to be about $1.3 billion in 2026; management’s ambition is well above $2 billion in 2027, conditional on current dynamics and engagements continuing.
• Free cash flow was positive at $351 million; balance-sheet inventory increased slightly to support expected Q4 revenue growth.