TI and ST lift semiconductor market spirits

29th July 2019
Mick Elliott

Texas Instruments (TI) and ST Microelectronics lifted spirits in the semiconductor industry as both reported results above expectations in their latest quarter. TI Q2 revenues dropped 9% year on year which means that revenues have declined for three successive quarters at the company.

Dave Pahl, Vice President and Head of Investor Relations remarks, “The history of semiconductor cycles indicates four or five quarters of decline, before the market recovers,” adding, “that’s an observation, not a forecast.”

And with good cash reserves and a healthy inventory, “we are ready for anything,” he added.

In its key product sectors, analogue revenues fell by 6% year on year and embedded processing slipped 16%.

In its market sectors, TI reported revenue falls in the upper single figures for industrial and automotive, and a lower single figure decline in personal electronics. Communications revenues were even year on year but down sequentially.

Pahl emphasised TI would retain its focus on the industrial and automotive sectors. “It is where we will allocate capital and drive initiatives,” he told analysts in a call hosted by

“We believe these are the fastest growing semiconductor markets,” he added.

ST Microelectronics filed Q2 results above the midpoint of its guidance. Revenues at $2.27bn dipped 4.2% year on year but were up 4.7% sequentially.

Says CEO Jan-March Chery, “This performance was driven by specialised imaging sensors, RF products for front-end modules, silicon carbide MOSFETs and digital automotive. Detractors were general purpose analogue, microcontroller and legacy automotive products.”

He highlighted the 7% global decline in car registrations.

Chery is upbeat about the third quarter forecasting revenue growth of about 15.3% at the midpoint, driven by engaged customer programs and new products in a softer than expected legacy Automotive and Industrial market.

Putting meat on the bones of this forecast Chery pointed to key programs with engaged key customers where the driver will be specialised imaging sensor and analogue. He also cited positive sign of recovery in the distribution channel, mainly in Asia, with two very positive KPI.

“First positive KPI is the positive trend increase in the point of sales of distributor cumulated with inventory decrease. So that's the reason why a second driver of the growth in Q3 will be the microcontroller. So, this is the three main contributor to the growth in Q3. It is specialised imaging sensor, analogue related to key programs and microcontrollers related to distribution channel addressing Industrial and mass market.”

Chery also reported cheering news on 5G market penetration.

“During the quarter, we won multiple ASIC designs for 5G infrastructure, 5G smartphone and Wi-Fi routers. This thanks to our unique technology portfolio,” said Chery.

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