STMicroelectronics Forecasts $4.15 Billion in Q4 Revenue, Reaffirms Margin Model

STMicroelectronics forecast fourth-quarter 2026 revenue of $4.15 billion at the midpoint and a 39% gross margin, while reaffirming a higher margin model for 2027-2028 tied to manufacturing changes.

The revenue midpoint is 10.5% above the third quarter and 24.7% higher than the year-earlier quarter. ST set a range of plus or minus 350 basis points around the revenue midpoint. The gross-margin forecast has a range of plus or minus 200 basis points and includes about 40 basis points of unused-capacity charges.

ST’s fourth-quarter outlook does not account for any further changes to current global trade tariffs. ST’s 39% margin forecast applies to the coming quarter; the 44%-46% figure is part of its intermediate financial model for 2027-2028. ST introduced that model in November 2024 with a revenue projection of about $18 billion.

President and CFO Lorenzo Grandi said ST remains committed to “achieving the 44% to 46% gross margin of our intermediate financial model, once our manufacturing reshaping plan is completed.”

The company expects changes to its manufacturing footprint to contribute more than 400 basis points of structural gross-margin improvement. The improvement could become visible in late 2027 or early 2028. The timing depends on legacy-fab shutdowns and customer qualification timing.

For the quarter ended Sept. 26, ST reported revenue of $3.76 billion, up 17.9% from a year earlier. ST’s 37.3% third-quarter gross margin reflected about 60 basis points in unused-capacity charges and 40 basis points in one-time manufacturing reshaping costs.