STMicroelectronics N.V. (NYSE:STM) Q2 2024 Earnings Conference Call July 25, 2024 3:30 AM ET

Company Participants

Celine Berthier - Group VP, IR
Jean-Marc Chery - President & CEO
Lorenzo Grandi - CFO, President of Finance, Purchasing, ERM & Resilience

Conference Call Participants

Jerome Ramel - BNP Paribas
Francois Bouvignies - UBS
Stephane Houri - ODDO
Sandeep Deshpande - JPMorgan
Sébastien Sztabowicz - Kepler Cheuvreux
Didier Scemama - Bank of America Merrill Lynch
Josh Buchalter - TD Cowan

Operator

Ladies and gentlemen, welcome to the STMicroelectronics Second Quarter 2024 Earnings Release Conference Call and live webcast. I am Moira, the Chorus Call operator. [Operator Instructions] The conference must not be recorded for publication or broadcast.

At this time, it's my pleasure to hand over to Celine Berthier, Group Vice President, Head of Investor Relations. Please go ahead, madam.

Celine Berthier

Thank you, Moira, and good morning. Thank you, everyone, for joining our second quarter 2024 financial results conference call. Hosting the call today is Jean-Marc Chery, ST's President and Chief Executive Officer. Joining Jean-Marc on the call today are: Lorenzo Grandi, President of Finance, Purchasing, ERM and Resilience and Chief Financial Officer; and Marco Cassis, President Analog Power and Discrete, Maintain Sensors Group and Head of Estimate Electronics Strategy System Research Applications and as Innovation Office.

This live webcast and presentation materials can be accessed on ST Investor Relations website. A replay will be available shortly after the conclusion of this call.

This call will include forward-looking statements that involve risk factors that could cause these results to differ materially from management's expectations and plans. We encourage you to review the safe harbor statement contained in the press release that was issued with the results this morning and also in ST's most recent regulatory filings for a full description of these risk factors. [Operator Instructions]

I'd now like to turn the call over to Jean-Marc, ST President and CEO.

Jean-Marc Chery

Thank you, Celine. Good morning, everyone, and thank you for joining the ST for our Q2 2024 earnings conference call. Let me begin with some opening comments.

Starting with Q2. Second quarter net revenues of $3.23 billion were above the midpoint of our business outlook range, driven by higher revenues in Personal Electronics partially offset by lower-than-expected revenues in Automotive. Gross margin of 40.1% was in line with expectations.

On a year-over-year basis, Q2 net revenues decreased 25.3% mainly driven by a decline in industrial and to a lesser extent in Automotive. Gross margin decreased to 40.1% from 49%. Operating margin decreased to 11.6% from 26.5%. And net income decreased 64.8% to $353 million.