UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of January, 2024

Commission File Number: 1-13546

 

STMicroelectronics N.V.

 

 

(Name of Registrant)

 

WTC Schiphol Airport
Schiphol Boulevard 265
1118 BH Schiphol Airport
The Netherlands

 

 

(Address of Principal Executive Offices)

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F x                          Form 40-F o

 

 

Enclosure: A press release dated January 25, 2024, announcing STMicroelectronics’ 2023 Fourth Quarter and Full Year Financial Results.

 

 

 

 

 

   

 

 

 

PR No: C3230C

 

 

STMicroelectronics Reports Q4 and FY 2023 Financial Results

 

·Q4 net revenues $4.28 billion; gross margin 45.5%; operating margin 23.9%; net income $1.08 billion
·FY net revenues $17.29 billion; gross margin 47.9%; operating margin 26.7%; net income $4.21 billion
·Business outlook at mid-point: Q1 net revenues of $3.6 billion and gross margin of 42.3%

 

Geneva, January 25, 2024 – STMicroelectronics N.V. (“ST”) (NYSE: STM), a global semiconductor leader serving customers across the spectrum of electronics applications, reported U.S. GAAP financial results for the fourth quarter ended December 31, 2023. This press release also contains non-U.S. GAAP measures (see Appendix for additional information).

 

ST reported fourth quarter net revenues of $4.28 billion, gross margin of 45.5%, operating margin of 23.9%, and net income of $1.08 billion or $1.14 diluted earnings per share.

 

Jean-Marc Chery, ST President & CEO, commented:

 

·“FY23 revenues increased 7.2% to $17.29 billion. Operating margin was 26.7% compared to 27.5% in FY22 and net income increased 6.3% to $4.21 billion. We invested $4.11 billion in net CAPEX while delivering free cash flow of $1.77 billion.”
·“In Q4, ST delivered revenues and gross margin slightly below the mid-point of the guidance, with higher revenues in Personal Electronics offset by a softer growth rate in Automotive.”
·“In Q4, our customer order bookings decreased compared to Q3. We continued to see stable end-demand in Automotive, no significant increase in Personal Electronics, and further deterioration in Industrial.”
·“Our first quarter business outlook, at the mid-point, is for net revenues of $3.6 billion, decreasing year-over-year by 15.2% and decreasing sequentially by 15.9%; gross margin is expected to be about 42.3%.”
·“For 2024, we plan to invest about $2.5 billion in net CAPEX.”
·“We will drive the Company based on a plan for FY24 revenues in the range of $15.9 billion to $16.9 billion. Within this plan, we expect a gross margin in the low to mid-40’s.”

 

Quarterly Financial Summary (U.S. GAAP)

 

(US$ m, except per share data)  Q4 2023  Q3 2023  Q4 2022  Q/Q  Y/Y
Net Revenues  $4,282   $4,431   $4,424    -3.4%   -3.2%
Gross Profit  $1,949   $2,109   $2,102    -7.6%   -7.3%
Gross Margin   45.5%   47.6%   47.5%   -210 bps    -200 bps 
Operating Income  $1,023   $1,241   $1,287    -17.5%   -20.5%
Operating Margin   23.9%   28.0%   29.1%   -410 bps    -520 bps 
Net Income  $1,076   $1,090   $1,248    -1.3%   -13.8%
Diluted Earnings Per Share  $1.14   $1.16   $1.32    -1.7%   -13.6%

 

 

 

   

 

 

Annual Financial Summary (U.S. GAAP)

 

(US$ m, except earnings per share data)  FY2023  FY2022  Y/Y
Net Revenues  $17,286   $16,128    7.2%
Gross Profit  $8,287   $7,635    8.5%
Gross Margin   47.9%   47.3%   60 bps 
Operating Income  $4,611   $4,439    3.9%
Operating Margin   26.7%   27.5%   -80 bps 
Net Income  $4,211   $3,960    6.3%
Diluted Earnings Per Share  $4.46   $4.19    6.4%

 

 

Fourth Quarter 2023 Summary Review

 

Net Revenues By Product Group (US$ m)  Q4 2023  Q3 2023  Q4 2022  Q/Q  Y/Y
Automotive and Discrete Group (ADG)   2,060    2,025    1,696    1.7%   21.5%
Analog, MEMS and Sensors Group (AMS)   993    990    1,339    0.4%   -25.8%
Microcontrollers and Digital ICs Group (MDG)   1,225    1,412    1,383    -13.3%   -11.5%
Others   4    4    6    —      —   
Total Net Revenues  $4,282    4,431    4,424    -3.4%   -3.2%

 

Net revenues totaled $4.28 billion, representing a year-over-year decrease of 3.2%. On a year-over-year basis, ADG revenues increased 21.5%, while AMS and MDG decreased 25.8% and 11.5% respectively. Year-over-year net sales to OEMs and Distribution decreased 0.4% and 9.2%, respectively. On a sequential basis, net revenues decreased 3.4%, 40 basis points lower than the mid-point of ST’s guidance. On a sequential basis, ADG reported an increase in net revenues, AMS was stable and MDG decreased.

 

Gross profit totaled $1.95 billion, representing a year-over-year decrease of 7.3%. Gross margin of 45.5%, 50 basis points below the mid-point of ST’s guidance, decreased 200 basis points year-over-year, due to higher input manufacturing costs, unused capacity charges, and negative currency effect net of hedging, partially offset by the combination of sales price and product mix.

 

Operating income decreased 20.5% to $1.02 billion, compared to $1.29 billion in the year-ago quarter. ST’s operating margin decreased 520 basis points on a year-over-year basis to 23.9% of net revenues, compared to 29.1% in the fourth quarter of 2022.

 

By product group, compared with the year-ago quarter:

 

Automotive and Discrete Group (ADG):

·Revenue increased for both Automotive and Power Discrete.
·Operating profit increased by 39.7% to $657 million. Operating margin was 31.9% compared to 27.7%.

 

Analog, MEMS and Sensors Group (AMS):

·Revenue increased in Analog and decreased in Imaging and in MEMS.
·Operating profit decreased by 57.4% to $147 million. Operating margin was 14.8% compared to 25.8%.

 

Microcontrollers and Digital ICs Group (MDG):

·Revenue decreased for Microcontrollers and increased for RF Communications.
·Operating profit decreased by 30.9% to $342 million. Operating margin was 28.0% compared to 35.8%.

 

Net income decreased to $1.08 billion compared to $1.25 billion in the year-ago quarter. Both the fourth quarter 2023 and the fourth quarter 2022 financial results included one-time non-cash income tax benefits of $191 million and $141 million respectively. Diluted earnings per share decreased to $1.14 compared to $1.32 in the year-ago quarter.

 

   

 

 

Cash Flow and Balance Sheet Highlights

 

 

            Trailing 12 Months
(US$ m)  Q4 2023  Q3 2023  Q4 2022  Q4 2023  Q4 2022  TTM Change
Net cash from operating activities   1,480    1,881    1,550    5,992    5,202    15.2%
Free cash flow (non-U.S. GAAP)1   652    707    603    1,774    1,591    11.5%

 

 

Net cash from operating activities was $1.48 billion in the fourth quarter compared to $1.55 billion in the year-ago quarter. For the full-year 2023, net cash from operating activities increased 15.2% to $5.99 billion, representing 34.7% of total revenues.

 

Capital expenditure payments, net of proceeds from sales, capital grants and other contributions, were $798 million in the fourth quarter and $4.11 billion for the full year 2023. In the respective year-ago periods, net capital expenditures were $920 million and $3.52 billion.

 

Free cash flow (non-U.S. GAAP) was $652 million and $1.77 billion in the fourth quarter and full year, respectively, compared to $603 million and $1.59 billion in the year-ago respective periods.

 

Inventory at the end of the fourth quarter was $2.70 billion, compared to $2.87 billion in the previous quarter and $2.58 billion in the year-ago quarter. Days sales of inventory at quarter-end was 104 days compared to 114 days in the previous quarter and 101 days in the year-ago quarter.

 

In the fourth quarter, ST paid cash dividends to its stockholders totaling $60 million and executed a $86 million share buy-back as part of its current share repurchase program.

 

ST’s net financial position (non-U.S. GAAP) was $3.16 billion as of December 31, 2023, compared to $2.46 billion as of September 30, 2023 and reflected total liquidity of $6.08 billion and total financial debt of $2.93 billion. Adjusted net financial position, taking into consideration the effect on total liquidity of advances from capital grants for which capital expenditures have not been incurred yet, stood at $3.00 billion as of December 31, 2023.

 

Corporate developments

 

On January 10, 2024, ST announced a new organization to deliver enhanced product development innovation and efficiency, time-to-market as well as customer focus by end market. ST will be re-organized into two Product Groups, split into four Reportable Segments and the existing sales and marketing organization will be complemented by a new application marketing organization focused by end markets across all Regions.

The new organization implies a change in reporting which will apply from January 1, 2024.

 

 

Business Outlook

 

ST’s guidance, at the mid-point, for the 2024 first quarter is:

 

·Net revenues are expected to be $3.6 billion, a decrease of 15.9% sequentially, plus or minus 350 basis points.
·Gross margin of 42.3%, plus or minus 200 basis points.
·This outlook is based on an assumed effective currency exchange rate of approximately $1.09 = €1.00 for the 2024 first quarter and includes the impact of existing hedging contracts.
·The first quarter will close on March 30, 2024.

 

Conference Call and Webcast Information

 

ST will conduct a conference call with analysts, investors and reporters to discuss its fourth quarter and full year 2023 financial results and current business outlook today at 9:30 a.m. Central European Time (CET) / 3:30 a.m. U.S. Eastern Time (ET). A live webcast (listen-only mode) of the conference call will be accessible at ST’s website, https://investors.st.com, and will be available for replay until February 9, 2024.

 

 

 

 

 1 Non-U.S. GAAP. See Appendix for reconciliation to U.S. GAAP and information explaining why ST believes these measures are important.

   

 

 

Use of Supplemental Non-U.S. GAAP Financial Information

 

This press release contains supplemental non-U.S. GAAP financial information.

 

Readers are cautioned that these measures are unaudited and not prepared in accordance with U.S. GAAP and should not be considered as a substitute for U.S. GAAP financial measures. In addition, such non-U.S. GAAP financial measures may not be comparable to similarly titled information from other companies. To compensate for these limitations, the supplemental non-U.S. GAAP financial information should not be read in isolation, but only in conjunction with ST’s consolidated financial statements prepared in accordance with U.S. GAAP.

 

See the Appendix of this press release for a reconciliation of ST’s non-U.S. GAAP financial measures to their corresponding U.S. GAAP financial measures.

 

Forward-looking Information

 

Some of the statements contained in this release that are not historical facts are statements of future expectations and other forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933 or Section 21E of the Securities Exchange Act of 1934, each as amended) that are based on management’s current views and assumptions, and are conditioned upon and also involve known and unknown risks and uncertainties that could cause actual results, performance, or events to differ materially from those anticipated by such statements, due to, among other factors:

 

changes in global trade policies, including the adoption and expansion of tariffs and trade barriers, that could affect the macro-economic environment and adversely impact the demand for our products;
uncertain macro-economic and industry trends (such as inflation and fluctuations in supply chains), which may impact production capacity and end-market demand for our products;
customer demand that differs from projections;
the ability to design, manufacture and sell innovative products in a rapidly changing technological environment;
changes in economic, social, public health, labor, political, or infrastructure conditions in the locations where we, our customers, or our suppliers operate, including as a result of macroeconomic or regional events, geopolitical and military conflicts (including the ongoing conflict between Russia and Ukraine), social unrest, labor actions, or terrorist activities;
unanticipated events or circumstances, which may impact our ability to execute our plans and/or meet the objectives of our R&D and manufacturing programs, which benefit from public funding;
financial difficulties with any of our major distributors or significant curtailment of purchases by key customers;
the loading, product mix, and manufacturing performance of our production facilities and/or our required volume to fulfill capacity reserved with suppliers or third-party manufacturing providers;
availability and costs of equipment, raw materials, utilities, third-party manufacturing services and technology, or other supplies required by our operations (including increasing costs resulting from inflation);
the functionalities and performance of our information technology (“IT”) systems, which are subject to cybersecurity threats and which support our critical operational activities including manufacturing, finance and sales, and any breaches of our IT systems or those of our customers, suppliers, partners and providers of third-party licensed technology;
theft, loss, or misuse of personal data about our employees, customers, or other third parties, and breaches of data privacy legislation;
the impact of intellectual property claims by our competitors or other third parties, and our ability to obtain required licenses on reasonable terms and conditions;
changes in our overall tax position as a result of changes in tax rules, new or revised legislation, the outcome of tax audits or changes in international tax treaties which may impact our results of operations as well as our ability to accurately estimate tax credits, benefits, deductions and provisions and to realize deferred tax assets;
variations in the foreign exchange markets and, more particularly, the U.S. dollar exchange rate as compared to the Euro and the other major currencies we use for our operations;
the outcome of ongoing litigation as well as the impact of any new litigation to which we may become a defendant;
product liability or warranty claims, claims based on epidemic or delivery failure, or other claims relating to our products, or recalls by our customers for products containing our parts;
natural events such as severe weather, earthquakes, tsunamis, volcano eruptions or other acts of nature, the effects of climate change, health risks and epidemics or pandemics such as the COVID-19 pandemic in locations where we, our customers or our suppliers operate;

 

   

 

 

increased regulation and initiatives in our industry, including those concerning climate change and sustainability matters and our goal to become carbon neutral on scope 1 and 2 and partially scope 3 by 2027;
potential loss of key employees and potential inability to recruit and retain qualified employees as a result of epidemics or pandemics such as the COVID-19 pandemic, remote-working arrangements and the corresponding limitation on social and professional interaction;
the duration and the severity of the global outbreak of COVID-19 may continue to negatively impact the global economy in a significant manner for an extended period of time, and also could materially adversely affect our business and operating results;
industry changes resulting from vertical and horizontal consolidation among our suppliers, competitors, and customers; and
the ability to successfully ramp up new programs that could be impacted by factors beyond our control, including the availability of critical third-party components and performance of subcontractors in line with our expectations.

 

Such forward-looking statements are subject to various risks and uncertainties, which may cause actual results and performance of our business to differ materially and adversely from the forward-looking statements. Certain forward-looking statements can be identified by the use of forward looking terminology, such as “believes,” “expects,” “may,” “are expected to,” “should,” “would be,” “seeks” or “anticipates” or similar expressions or the negative thereof or other variations thereof or comparable terminology, or by discussions of strategy, plans or intentions.

 

Some of these risks are set forth and are discussed in more detail in “Item 3. Key Information — Risk Factors” included in our Annual Report on Form 20-F for the year ended December 31, 2022 as filed with the Securities and Exchange Commission (“SEC”) on February 23, 2023. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this press release as anticipated, believed, or expected. We do not intend, and do not assume any obligation, to update any industry information or forward-looking statements set forth in this release to reflect subsequent events or circumstances.

 

Unfavorable changes in the above or other risks or uncertainties listed under “Item 3. Key Information — Risk Factors”

from time to time in our SEC filings, could have a material adverse effect on our business and/or financial condition.

 

 

About STMicroelectronics

 

At ST, we are over 50,000 creators and makers of semiconductor technologies mastering the semiconductor supply chain with state-of-the-art manufacturing facilities. An integrated device manufacturer, we work with more than 200,000 customers and thousands of partners to design and build products, solutions, and ecosystems that address their challenges and opportunities, and the need to support a more sustainable world. Our technologies enable smarter mobility, more efficient power and energy management, and the wide-scale deployment of cloud-connected autonomous things. We are committed to achieving our goal to become carbon neutral on scope 1 and 2 and partially scope 3 by 2027.
Further information can be found at www.st.com.

 

For further information, please contact:

 

INVESTOR RELATIONS:

Céline Berthier

Group VP, Investor Relations

Tel: +41 22 929 58 12

celine.berthier@st.com

 

MEDIA RELATIONS:

Alexis Breton

Corporate External Communications

Tel: + 33 6 59 16 79 08

alexis.breton@st.com

 

 

 

 

   

 

 

 

STMicroelectronics N.V.      
CONSOLIDATED STATEMENTS OF INCOME      
(in millions of U.S. dollars, except per share data ($))      
       
   Three months ended
   December 31,  December 31,
   2023  2022
   (Unaudited)  (Unaudited)
       
Net sales   4,262    4,408 
Other revenues   20    16 
NET REVENUES   4,282    4,424 
Cost of sales   (2,333)   (2,322)
GROSS PROFIT   1,949    2,102 
Selling, general and administrative   (416)   (378)
Research and development   (521)   (472)
Other income and expenses, net   11    35 
Total operating expenses   (926)   (815)
OPERATING INCOME   1,023    1,287 
Interest income, net   57    33 
Other components of pension benefit costs   (5)   (3)
INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTEREST   1,075    1,317 
Income tax (expense) benefit   6    (66)
NET INCOME   1,081    1,251 
Net income attributable to noncontrolling interest   (5)   (3)
NET INCOME ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS   1,076    1,248 
           
EARNINGS PER SHARE (BASIC) ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS   1.19    1.38 
EARNINGS PER SHARE (DILUTED) ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS   1.14    1.32 
           
NUMBER OF WEIGHTED AVERAGE SHARES USED IN CALCULATING DILUTED EPS   942.9    944.2 
           

 

 

 

 

 

   

 

 

 

STMicroelectronics N.V.      
CONSOLIDATED STATEMENTS OF INCOME      
(in millions of U.S. dollars, except per share data ($))      
       
   Twelve months ended
   December 31,  December 31,
   2023  2022
   (Unaudited)  (Audited)
       
Net sales   17,239    16,083 
Other revenues   47    45 
NET REVENUES   17,286    16,128 
Cost of sales   (8,999)   (8,493)
GROSS PROFIT   8,287    7,635 
Selling, general and administrative   (1,631)   (1,454)
Research and development   (2,100)   (1,901)
Other income and expenses, net   55    159 
Total operating expenses   (3,676)   (3,196)
OPERATING INCOME   4,611    4,439 
Interest income, net   171    58 
Other components of pension benefit costs   (19)   (11)
INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTEREST   4,763    4,486 
Income tax expense   (541)   (520)
NET INCOME   4,222    3,966 
Net income attributable to noncontrolling interest   (11)   (6)
NET INCOME ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS   4,211    3,960 
           
EARNINGS PER SHARE (BASIC) ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS   4.66    4.37 
EARNINGS PER SHARE (DILUTED) ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS   4.46    4.19 
           
NUMBER OF WEIGHTED AVERAGE SHARES USED IN CALCULATING DILUTED EPS   944.2    946.2 
           

 

 

 

 

   

 

          
STMicroelectronics N.V.         
CONSOLIDATED BALANCE SHEETS         
As at  December 31,  September 30,  December 31,
In millions of U.S. dollars  2023  2023  2022
    (Unaudited)    (Unaudited)    (Audited) 
ASSETS               
Current assets:               
Cash and cash equivalents   3,222    3,011    3,258 
Short-term deposits   1,226    506    581 
Marketable securities   1,635    1,537    679 
Trade accounts receivable, net   1,731    1,837    1,970 
Inventories   2,698    2,870    2,583 
Other current assets   1,295    1,230    734 
Total current assets   11,807    10,991    9,805 
Goodwill   303    294    297 
Other intangible assets, net   367    353    405 
Property, plant and equipment, net   10,554    9,672    8,201 
Non-current deferred tax assets   592    510    602 
Long-term investments   22    21    11 
Other non-current assets   808    721    661 
    12,646    11,571    10,177 
Total assets   24,453    22,562    19,982 
                
LIABILITIES AND EQUITY               
Current liabilities:               
Short-term debt   217    173    175 
Trade accounts payable   1,856    1,555    2,122 
Other payables and accrued liabilities   1,525    1,517    1,385 
Dividends payable to stockholders   54    115    60 
Accrued income tax   78    377    95 
Total current liabilities   3,730    3,737    3,837 
Long-term debt   2,710    2,418    2,542 
Post-employment benefit obligations   372    338    331 
Long-term deferred tax liabilities   54    55    60 
Other long-term liabilities   735    507    454 
    3,871    3,318    3,387 
Total liabilities   7,601    7,055    7,224 
Commitment and contingencies               
Equity               
Parent company stockholders' equity               
Common stock (preferred stock: 540,000,000 shares authorized, not issued; common stock: Euro 1.04 nominal value, 1,200,000,000 shares authorized, 911,281,920 shares issued, 902,771,081 shares outstanding as of December 31, 2023)   1,157    1,157    1,157 
Additional Paid-in Capital   2,866    2,800    2,631 
Retained earnings   12,470    11,395    8,713 
Accumulated other comprehensive income   613    376    460 
Treasury stock   (377)   (293)   (268)
Total parent company stockholders' equity   16,729    15,435    12,693 
Noncontrolling interest   123    72    65 
Total equity   16,852    15,507    12,758 
Total liabilities and equity   24,453    22,562    19,982 
                
                

 

 

   

 

 

          
STMicroelectronics N.V.         
          
SELECTED CASH FLOW DATA         
          
Cash Flow Data (in US$ millions)  Q4 2023  Q3 2023  Q4 2022
          
Net Cash from operating activities   1,480    1,881    1,550 
Net Cash used in investing activities   (1,610)   (1,756)   (924)
Net Cash from (used in) financing activities   336    (223)   (185)
Net Cash increase (decrease)   211    (100)   446 
                
Selected Cash Flow Data (in US$ millions)   Q4 2023    Q3 2023    Q4 2022 
                
Depreciation & amortization   414    396    331 
Net payment for Capital expenditures   (798)   (1,152)   (920)
Dividends paid to stockholders   (60)   (58)   (54)
Change in inventories, net   219    147    (125)
                

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   

 

 

 

Appendix

ST

Supplemental Financial Information

 

 

   Q4 2023  Q3 2023  Q2 2023  Q1 2023  Q4 2022  FY 2023  FY 2022
Net Revenues By Market Channel (%)                     
Total OEM   70%   67%   64%   64%   68%   66%   67%
Distribution   30%   33%   36%   36%   32%   34%   33%
                                    
€/$ Effective Rate   1.08    1.09    1.08    1.06    1.04    1.08    1.10 
                                    
Product Group Data (US$ m)                                   
Automotive & Discrete Group (ADG)                                   
 - Net Revenues   2,060    2,025    1,955    1,807    1,696    7,848    5,969 
 - Operating Income   657    638    624    577    470    2,497    1,469 
Analog, MEMS & Sensors Group (AMS)                                   
 - Net Revenues   993    990    940    1,068    1,339    3,991    4,911 
 - Operating Income   147    186    139    218    346    690    1,237 
Microcontrollers & Digital ICs Group (MDG)                                   
 - Net Revenues   1,225    1,412    1,427    1,368    1,383    5,431    5,228 
 - Operating Income   342    496    505    495    495    1,838    1,830 
Others (a)                                   
 - Net Revenues   4    4    4    4    6    16    20 
 - Operating Income (Loss)   (123)   (79)   (122)   (89)   (24)   (414)   (97)
Total                                   
 - Net Revenues   4,282    4,431    4,326    4,247    4,424    17,286    16,128 
 - Operating Income   1,023    1,241    1,146    1,201    1,287    4,611    4,439 

 

(a) Net revenues of Others include revenues from sales assembly services and other revenues. Operating income (loss) of Others includes items such as unused capacity charges, including reduced manufacturing activity due to COVID-19 and incidents leading to power outage, impairment, restructuring charges and other related closure costs, management reorganization costs, start-up and phase-out costs of certain manufacturing facilities, and other unallocated income (expenses) such as: strategic or special research and development programs, certain corporate-level operating expenses, patent claims and litigations, and other costs that are not allocated to product groups, as well as operating earnings of other products. Others includes:

 

 

(US$ m)  Q4 2023  Q3 2023  Q2 2023  Q1 2023  Q4 2022  FY 2023  FY 2022
Unused capacity charges   57    46    15    1    —      120    22 

 

 

 

 

   

 

 

 

(Appendix – continued)

ST

Supplemental Non-U.S. GAAP Financial Information

U. S. GAAP – Non-U.S. GAAP Reconciliation

 

The supplemental non-U.S. GAAP information presented in this press release is unaudited and subject to inherent limitations. Such non-U.S. GAAP information is not based on any comprehensive set of accounting rules or principles and should not be considered as a substitute for U.S. GAAP measurements. Also, our supplemental non-U.S. GAAP financial information may not be comparable to similarly titled non-U.S. GAAP measures used by other companies. Further, specific limitations for individual non-U.S. GAAP measures, and the reasons for presenting non-U.S. GAAP financial information, are set forth in the paragraphs below. To compensate for these limitations, the supplemental non-U.S. GAAP financial information should not be read in isolation, but only in conjunction with our consolidated financial statements prepared in accordance with U.S. GAAP.

 

ST believes that these non-U.S. GAAP financial measures provide useful information for investors and management because they offer, when read in conjunction with ST’s U.S. GAAP financials, (i) the ability to make more meaningful period-to-period comparisons of ST’s on-going operating results, (ii) the ability to better identify trends in ST’s business and perform related trend analysis, and (iii) to facilitate a comparison of ST’s results of operations against investor and analyst financial models and valuations, which may exclude these items.

 

Net Financial Position and Adjusted Net Financial Position (non-U.S. GAAP measures)

 

Net Financial Position, a non-U.S. GAAP measure, represents the difference between our total liquidity and our total financial debt. Our total liquidity includes cash and cash equivalents, restricted cash, if any, short-term deposits, and marketable securities, and our total financial debt includes short-term debt and long-term debt, as reported in our Consolidated Balance Sheets. Starting Q4 2023, ST also presents adjusted net financial position as a non-U.S. GAAP measure, to take into consideration the effect on total liquidity of advances received on capital grants for which capital expenditures have not been incurred yet. Prior periods are not impacted.

 

ST believes its Net Financial Position and Adjusted Net Financial Position provide useful information for investors and management because they give evidence of our global position either in terms of net indebtedness or net cash by measuring our capital resources based on cash and cash equivalents, restricted cash, if any, short-term deposits and marketable securities and the total level of our financial debt. Our definitions of Net Financial Position and Adjusted Net Financial Position may differ from definitions used by other companies, and therefore, comparability may be limited.

 

 

(US$ m)  Dec 31 2023  Sep 30 2023  July 1 2023  Apr 1 2023  Dec 31 2022
Cash and cash equivalents   3,222    3,011    3,111    3,572    3,258 
Short term deposits   1,226    506    106    106    581 
Marketable securities   1,635    1,537    1,346    841    679 
Total liquidity   6,083    5,054    4,563    4,519    4,518 
Short-term debt   (217)   (173)   (176)   (176)   (175)
Long-term debt (a)   (2,710)   (2,418)   (2,473)   (2,488)   (2,542)
Total financial debt   (2,927)   (2,591)   (2,649)   (2,664)   (2,717)
Net Financial Position   3,156    2,463    1,914    1,855    1,801 
Advances from capital grants   (152)   —      —      —      —   
Adjusted Net Financial Position   3,004    2,463    1,914    1,855    1,801 

 

(a)Long-term debt contains standard conditions but does not impose minimum financial ratios. Committed credit facilities for $1.0 billion equivalent, are currently undrawn.

 

 

 

   

 

 

 

(Appendix – continued)

ST

 

Free Cash Flow (non-U.S. GAAP measure)

 

Free Cash Flow, which is a non-U.S. GAAP measure, is defined as (i) net cash from operating activities plus (ii) net cash used in investing activities, excluding payment for purchases of (and proceeds from matured) marketable securities and net investment in (and proceeds from) short-term deposits, which are considered as temporary financial investments. This definition ultimately results in net cash from operating activities plus payment for purchase (and proceeds from sale) of tangible, intangible and financial assets, proceeds from capital grants and other contributions, and net cash paid for business acquisitions, if any.

 

ST believes Free Cash Flow provides useful information for investors and management because it measures our capacity to generate cash from our operating and investing activities to sustain our operations. Free Cash Flow does not represent total cash flow since it does not include the cash flows from, or used in, financing activities.

 

Free Cash Flow reconciles with the total cash flow and the net cash increase (decrease) by including the payment for purchases of (and proceeds from matured) marketable securities and net investment in (and proceeds from) short-term deposits, the net cash from (used in) financing activities and the effect of changes in exchange rates. Our definition of Free Cash Flow may differ from definitions used by other companies.

 

 

(US$ m) 

Q4

2023

  Q3 2023  Q2 2023  Q1 2023  Q4 2022  FY 2023  FY 2022
Net cash from operating activities   1,480    1,881    1,311    1,320    1,550    5,992    5,202 
Payment for purchase of tangible assets, net of proceeds from sale and proceeds from capital grants and other contributions   (798)   (1,152)   (1,072)   (1,090)   (920)   (4,111)   (3,524)
Payment for purchase of intangible assets, net of proceeds from sale   (28)   (22)   (22)   (24)   (27)   (97)   (87)
Payment for purchase of financial assets, net of proceeds from sale   (2)   —      (8)   —      —      (10)   —   
Free Cash Flow (a)   652    707    209    206    603    1,774    1,591 

 

(a)Free Cash Flow can also be expressed as net cash from operating and investing activities, excluding cash from (used in) marketable securities and short-term deposits.

 

 

   

 

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

      STMicroelectronics N.V.
       
Date: January 25, 2024 By:           /s/ Lorenzo Grandi          
       
    Name: Lorenzo Grandi
    Title:

Chief Financial Officer

President, Finance, Purchasing, ERM

and Resilience