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Geneva (pte028/11.01.2005/14:00) - Europe's largest semiconductor manufacturer STMicroelectronics http://www.st.com expects its fourth-quarter revenue growth will be at the higher end of what was previously expected, but has warned its gross margin was less than expected. As the Financial Times (FT) http://www.ft.com reports, the French-Italian group estimated that net revenues for the three months leading up to December 31 would be 2.3 billion dollars (1.7 billion euros), a 4.3 per cent increase on the previous quarter and within its forecast of between flat and 5 per cent growth.
The company cautioned, however, that the gross margin for the period would be 36.6 per cent, lower than a guidance range of 38-39 per cent. ST Micro has blamed the weakening of the US Dollar for the eroding of this margin, but stated that "continuing pricing pressure and lower than expected manufacturing utilisation and performances at certain fabs" had also contributed.
"As previously announced, the earlier guidance was based upon an average euro to dollar exchange rate of 1.23 dollars (0.93 euros). The actual quarterly average euro/dollar exchange rate was approximately 1.27 dollars (0.96 euros)," the company said in a statement.
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