STMicroelectronics defies chips gloom with Q1 beat

By Martin Coulter

LONDON (Reuters) -European chipmaker STMicroelectronics beat first-quarter results forecasts on Thursday, defying signs of a slowdown in the semiconductor industry.

However, it shares fell around 4% in early trade as investors worried the slowdown would eventually catch up with the company, which counts iPhone maker Apple and carmaker Tesla among its customers.

STMicro reported first-quarter earnings per share (EPS) of $1.10 on a 20% increase in revenues to $4.25 billion. Analysts had expected EPS of $0.99 and revenues of $4.19 billion, according to IBES data from Refinitiv Eikon.

"STMicro continues to grow robustly during a semiconductor downcycle, so they are bucking the trend. The key question for investors is: how long will that last?" said Paul Allison, an analyst at investment platform Finimize.

"Analysts on Wall Street and elsewhere who are slightly less positive are saying exactly that. Watch out for a slowdown later in the year."

CEO Jean-Marc Chery said STMicro was aiming for full-year revenue of $17 billion to $17.8 billion, keeping it on course for its target of $20 billion by 2027.

"We are operating in an environment with significantly different dynamics depending on the end markets we serve. Based on our leadership position, strategic approach and current visibility, we anticipate another year of revenue growth and profitability," Chery said.

Rival Texas Instruments forecast second-quarter revenue and profit below Wall Street estimates on Wednesday.

STMicro's net income rose about 40% year-over-year to $1.04 billion in the quarter.

(Reporting by Martin Coulter; Editing by Savio D'Souza and Mark Potter)