By Mauro Orru

 

STMicroelectronics NV raised its sales forecast for the year after posting higher net profit and better-than-expected revenue for the second quarter, a sign that demand for chips remains strong after a banner two years for the sector.

The European chip maker said Thursday that net profit surged to $867 million from $412 million in the second quarter of last year.

Net revenue climbed to $3.84 billion from $2.99 billion.

Gross profit increased to $1.82 billion from $1.21 billion with a gross margin of 47.4%, while operating income rose to $1 billion from $489 million with an operating margin of 26.2%.

STMicroelectronics had expected second-quarter net revenue of $3.75 billion at the midpoint, and a gross margin of roughly 46%.

"Net revenues and gross margin came in above the mid-point of our business outlook range driven by continued strong demand for our product portfolio," said Chief Executive Jean-Marc Chery.

For the third quarter, the company targets net revenue of $4.24 billion at the midpoint, and a gross margin of about 47%.

For the year, STMicroelectronics now expects revenue of $15.9 billion to $16.2 billion, up from a previous forecast of $14.8 billion to $15.3 billion.

 

Write to Mauro Orru at mauro.orru@wsj.com; @MauroOrru94

 

(END) Dow Jones Newswires

July 28, 2022 01:35 ET (05:35 GMT)

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