STMicroelectronics set a $4.15 billion midpoint for fourth-quarter 2026 revenue after third-quarter sales rose 17.9% year over year, while demand for its products remained above available supply.
Revenue for the quarter ended Sept. 26, 2026, totaled $3.757 billion. U.S. GAAP operating income rose 104.5% year over year to $367 million, compared with $180 million a year earlier. Net income to parent-company stockholders increased 22.8% to $291 million, from $237 million. Non-U.S. GAAP operating income reached $429 million, up 98% year over year from $217 million in the third quarter of 2025.
Results varied across business segments. RF Optical Communications revenue grew 46.2% year over year to $504 million, while Embedded Processing revenue climbed 24.1% to $1.212 billion. Power and Discrete revenue increased 11.3% to $477 million, but its operating loss widened to $81 million from $67 million year over year.
Gross margin reached 37.3%, compared with 33.2% a year earlier. ST linked the improvement to lower costs from unused capacity and a stronger product mix. Its U.S. GAAP operating result included $55 million in impairment, restructuring and phase-out charges, along with $7 million in purchase-price-allocation effects tied to its acquisition of NXP’s MEMS sensor business.
ST attributed year-over-year growth to the cyclical recovery and company-specific demand connected to AI data centers and low-Earth-orbit satellite communications. The company said demand continued to outstrip supply and that it was adding capacity. Its revenue midpoint implies full-year 2026 sales of about $14.5 billion, up 22.8% from 2025.
The fourth-quarter revenue outlook is 10.5% above the third-quarter figure, with a range of plus or minus 350 basis points. ST projected a 39% gross margin, plus or minus 200 basis points, and based its outlook on an exchange rate of $1.14 per euro. The forecast does not include the effect of potential further changes to global trade tariffs.
Reuters reported that analysts polled by the London Stock Exchange Group had expected fourth-quarter revenue of $4.10 billion and third-quarter non-U.S. GAAP operating income of $400.5 million. ST’s fourth quarter ends Dec. 31, 2026.
