STMicroelectronics Reports 2008 Fourth Quarter and Full Year Revenues and Earnings

GENEVA — STMicroelectronics (NYSE: STM) reported financial results for the 2008 fourth quarter and full year ended December 31, 2008.

For the 2008 fourth quarter, the Company reported an operating loss of $139 million and a net loss of $366 million, or -$0.42 per share compared to the year-ago quarter operating loss of $15 million and net income of $20 million, or $0.02 per diluted share. Excluding charges relating to restructuring and impairment, inventory step-up, and other-than-temporary impairments on the Numonyx equity investment and certain financial assets, the fourth quarter 2008 net loss was $57 million, or -$0.06 per share compared to the year-ago quarter net income of $255 million or $0.27 per diluted share on a comparable basis.

Net revenues for the full year were $9.84 billion compared to 2007 revenues of $10.0 billion, as reported. Excluding FMG* and NXP Wireless**, net revenues grew 4.8% in the similar period.

Inventory was $1.84 billion at quarter end and reflected increased levels due to the sharp decrease in sales volumes in the fourth quarter 2008 and differences in the anticipated mix of products sold.

Both sequentially and year-over-year, all market segments posted declines reflecting the global economic slowdown. On a sequential basis, Automotive was lower by 21% and Telecom by 20%, followed by Computer which decreased 14%, Industrial by 10% and Consumer by 8%. In comparison to the year-ago quarter, Automotive declined 27%, followed by Computer which decreased by 20%, Telecom by 17%, Consumer by 12% and Industrial by 8%.

Net Revenues (In Million US$ and %)

                                     Full Year  Full Year  Year-over-Year
                                          2008       2007          Change
                                     ---------  ---------  --------------
Home Entertainment & Displays (HED)      1,585      1,402           13.0%

Product Highlights

In digital consumer, ST announced its leading-edge STi7141 cable TV set-top-box IC combining high-definition and interactive capabilities and the STDP3100 DisplayPort-to-VGA converter enabling seamless connectivity between legacy VGA monitors, projectors and the new generation of DisplayPort PCs and notebooks. ST’s DisplayPort products were adopted by two leading LCD and plasma TV makers for their ‘two-box’ TV systems, to deliver performance up to 120Hz full high definition.

* ST completed the deconsolidation of its Flash Memory Group (FMG) segment and took an equity interest in Numonyx on March 30, 2008, with an anticipated one quarter lag in reporting.
** ST-NXP Wireless, a joint venture owned 80% by ST, began operations on August 2, 2008 and is fully consolidated into ST’s operating results. The fourth and third quarter 2008 financial review includes the ST-NXP Wireless joint venture except where noted.

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