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Friday, November 28, 2008
STMicroelectronics Slashes 4Q Outlook
Adam Samson
FOXBusiness
STMicroelectronics slashed its fourth-quarter earnings outlook Friday as the “recent slowdown” squeezed the chipmaker’s bottom line.
The company now expects its fourth quarter revenues to dive between 12.8% and 18.4% compared with last quarter from only 8% previously projected.
"The revised revenue outlook is the consequence of a recent slowdown in the billings, recent and substantial changes in customers' demand and order push-outs for the month of December," STMicro said in a release.
The Franco-Italian company also dropped its gross margin forecast slightly. Gross margin is a key metric in determining a company’s profitability.
Consumer sentiment is depressed according to recent reports, and the several regional surveys have shown dramatic slowing in the manufacturing sector. STMicro is particularly affected by such cross-sector slowdowns because it produces products for such a wide variety of applications.
Shares of STMicro are off 7.8% to $6.60 on the day.
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