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SEC filingSTMicroelectronics reported Q1 2026 GAAP net income of $37 million ($0.04 diluted EPS), down sequentially from a $30 million loss but up year-over-year from $56 million, driven by $71 million in restructuring charges and $895 million MEMS sensor acquisition outflow; non-GAAP net income was $122 million ($0.13 EPS), with revenue at $3.095 billion, down 7.0% sequentially but up 23.0% year-over-year.
STMicroelectronics’ Q1 2026 results reflect a transitional quarter marked by strategic investment and operational recalibration. Revenue of $3.095 billion grew 23.0% year-over-year — the strongest quarterly growth since 2022 — driven by double-digit gains across AM&S (+23.2%), EMP (+31.3%), and RFOC (+33.9%), while P&D declined 1.8% amid pricing pressure. However, sequential revenue fell 7.0%, largely attributable to normal seasonality and the absence of full MEMS contribution in the prior quarter; ST noted the decline was 50 bps better than mid-point guidance, underscoring resilience in engaged customer programs. Gross margin contracted 140 bps sequentially to 33.8% due to adverse pricing, product mix, and FX headwinds — partially offset by higher manufacturing efficiencies and lower unused capacity charges — yet expanded 40 bps year-over-year, confirming structural margin improvement. The $71 million in impairment, restructuring, and phase-out charges — including $38M labor-related costs and $17M phase-out expenses — directly supports ST’s announced 2025 manufacturing reshaping program targeting 300mm silicon and 200mm SiC capacity expansion. Non-GAAP metrics reveal stronger underlying performance: non-GAAP operating income rose to $171 million (5.5% margin), up $160 million YoY, reflecting gross margin gains and disciplined expense management despite $70 million YoY increase in SG&A+R&D driven by labor, FX, and MEMS integration. The $895 million cash outflow for the NXP MEMS acquisition — funded via debt issuance — drove free cash flow to -$723 million, a sharp reversal from +$30 million YoY, signaling near-term capital intensity ahead of long-term scale benefits. Looking ahead, Q2 guidance implies acceleration: ~11.6% sequential revenue growth and 34.8% GAAP gross margin suggest improving demand momentum and stabilization of MEMS integration, though execution remains exposed to FX volatility (guidance assumes $1.15/€1.00) and macro uncertainty. With $2.0–2.2 billion planned Net Capex for 2026 — focused on Catania SiC, Crolles 300mm, and PLP pilot lines — ST is prioritizing capacity leadership in high-growth domains, even as earnings remain pressured by transformational investments.