STMicroelectronics : STMicroelectronics Reports 2013 Second Quarter and First Half Financial Results

STMicroelectronics : STMicroelectronics Reports 2013 Second Quarter and First
                            Half Financial Results

PR No. C2728C

                              STMicroelectronics
         Reports 2013 Second Quarter and First Half Financial Results

  *Second quarter net revenues $2.05 billion, gross margin 32.8%

  *ST revenues excluding Wireless product line increased 6.8% sequentially,
    in line with expectations

  *Second quarter operating expenses excluding restructuring charges $736
    million; down from $808 million and $887 million in the sequential and
    year-ago periods, respectively

  *ST-Ericsson transaction to close in early August

Geneva, July 22, 2013 - STMicroelectronics (NYSE: STM), a global semiconductor
leader serving customers across the spectrum of electronics applications,
reported financial results for the second quarter and first half ending June
29, 2013.

Second quarter net revenues totaled $2.05 billion and gross margin was 32.8%.
Net loss attributable to ST was $152 million.

"In the second quarter we saw sequential progress towards our objectives of
sales growth, gross margin improvement and expense reduction," said ST
President and CEO Carlo Bozotti.

"Sales were in line with our guidance, despite an accelerated decline of
ST-Ericsson's existing product revenues. Gross margin came in above the
midpoint of our guidance due to manufacturing efficiencies and increased
volumes. Our quarterly operating expense run rate continues to decrease
substantially both on a sequential and year-over-year basis.

"Our strong sequential increase in sales of 6.8%, excluding Wireless product
line, came from growth in several key product areas including
Microcontrollers, Industrial and Power, Automotive and Imaging. These results
are due to both the introduction of new products and the changes we made last
year to expand our geographic and customer coverage, with new major accounts
and distributors, with the latter further increasing as a percentage of sales.

"We again made solid progress towards our quarterly net operating expenses
target range as we exited the second quarter with operating expenses excluding
restructuring charges of $736 million, or $72 million and $151 million lower
than the prior and year-ago quarters." 

Summary Financial Highlights



U.S. GAAP                                             Q2 2013 Q1 2013 Q2 2012
(Million US$)
Net Revenues ^(a)                                      2,045   2,009   2,148
Gross Margin                                           32.8%   31.3%   34.3%
Operating Income (Loss), as reported                   (107)   (281)   (207)
Net Income (Loss) attributable to parent company ^(b)  (152)   (171)   (75)



(a) Net revenues include sales recorded by ST-Ericsson as consolidated by ST
(b) Includes a loss on equity-method investment of $89 million, $13 million
and $2 million in the second and first quarters of 2013 and the second quarter
of 2012, respectively



Non-U.S. GAAP*
Before impairment, restructuring and one-time items Q22013 Q12013 Q22012
(Million US$)
Operating Income (Loss)                              (64)    (180)   (151)
Operating Margin                                    (3.1%)  (8.9%)  (7.0%)
Operating Margin - Attributable to ST               (2.6%)  (5.3%)  (1.3%)



ST-Ericsson Information

As announced on March 18, 2013, ST and Ericsson have agreed to the transfer of
certain ST-Ericsson employees and assets to the respective parent companies
and to the wind-down of the remaining joint venture. The formal transfer of
the parts of ST-Ericsson to the parent companies is expected to be completed
in early August, 2013. As already communicated, from March 2, 2013 and until
completion of the wind-down, Ericsson is taking on the expenses of the LTE
Modem activities, and ST is taking on the existing products and related
business as well as expenses for resources working on ST programs. Both
parents are assuming equal funding of the wind-down activities.

During the first half of 2013, ST funded $145 million under the ST-Ericsson
parent facility. Based upon its latest review, ST estimates its total cash
costs from beginning 2013 thru the end of the JV, including covering its share
of ST-Ericsson's ongoing operations during the transition period and
restructuring costs in ST-Ericsson and ST related to the exit from the JV, at
between $300 million and $350 million. This is lower than the previous
estimate as a result of the timely restructuring and the transfer of certain
teams to third-party companies.

ST-Ericsson's net revenues in the second quarter of 2013 decreased 31%
sequentially to $176 million reflecting, as anticipated, the decline of legacy
products.

Second Quarter Review

Net revenues increased 1.8% sequentially and decreased 4.8% on a
year-over-year basis. Greater China & South Asia led all regions with 6.0%
sequential revenue growth while the Americas increased by 5.6% and EMEA
increased 5.2%. Japan & Korea was lower by 12.8% driven by business dynamics
at certain key wireless global accounts.

ST's second quarter revenues, excluding the Wireless product line, increased
6.8% on a sequential basis and 3.6% on a year-over-year basis, reflecting
better than normal seasonality.

Second quarter gross profit was $672 million and gross margin was 32.8%. On a
sequential basis, gross margin improved 150 basis points reflecting lower
unsaturation charges, manufacturing efficiencies and higher volumes partially
offset by price pressure.
-----
(*)Operating income (loss) before impairment, restructuring and one-time
items, operating margin before impairment, restructuring and one-time items
and operating margin before impairment, restructuring and one-time items
attributable to ST are non-U.S. GAAP measures. Please refer to Attachment A
for additional information explaining why the Company believes these measures
are important and reconciliation to U.S. GAAP.

R&D expenses were $453 million representing a sequential decrease of $80
million or 15%, benefiting principally from the ongoing restructuring
initiatives at ST-Ericsson as well as the charge back to Ericsson of the LTE
Modem expenses of $102 million partially offset by seasonality. R&D expenses
declined by 27% compared to the year-ago period.

SG&A expenses totaled $285 million in the second quarter, and on a sequential
basis, SG&A expenses increased by 2% mainly due to seasonality. SG&A expenses
decreased 2% compared to the year-ago period mainly due to cost-reduction
initiatives.

Impairment, restructuring and other related closure costs for the second
quarter were $43 million compared to $101 million in the prior quarter mainly
due to restructuring initiatives within the ST organization.

Operating margin before impairment, restructuring and one-time items
attributable to ST was a negative 2.6% in the 2013 second quarter compared to
negative 5.3% in the prior quarter.*

In the second quarter of 2013, net loss attributable to non-controlling
interest was $21 million, which mainly included the 50% owned by Ericsson in
the ST-Ericsson joint venture, as consolidated by ST. In the first quarter of
2013, the corresponding amount was $126 million.

ST recorded in the second quarter a charge of $89 million on equity-method
investments largely due to a one-time non-cash charge of $69 million on ST's
equity value in 3Sun due to impairment charges reported by the 3Sun joint
venture. 3Sun is a joint initiative between Enel Green Power, Sharp and the
Company for the manufacture of thin film photovoltaic panels in Catania,
Italy. Each partner owns a third of the common shares of the entity.

Second quarter net loss was $152 million or $(0.17) per share, compared to a
net loss of $(0.19) and $(0.08) per share in the prior and year-ago quarter,
respectively. On an adjusted basis, net of related taxes, ST reported non-U.S.
GAAP net loss per share of $(0.06) in the second quarter, excluding impairment
and restructuring charges and one-time items, compared to a net loss of
$(0.13) and $(0.05) per share in the prior and year-ago quarter,
respectively.*

For the second quarter of 2013, the effective average exchange rate for the
Company was approximately $1.30 to €1.00 compared to $1.31 to €1.00 for the
first quarter of 2013 and $1.32 to €1.00 for the second quarter of 2012.

Net Revenues by Market Channel



Net Revenues By Market Channel(%) Q2 2013 Q1 2013 Q2 2012
Total OEM                           74%     75%     78%
Distribution                        26%     25%     22%



-----
(*)Operating margin before impairment, restructuring and one-time items
attributable to ST and adjusted net earnings per share are non-U.S. GAAP
measures. For additional information and reconciliation to U.S. GAAP, please
refer to Attachment A.

Revenues and Operating Results by ST Product Segment



  Operating Segment   Q2 2013   Q2 2013  Q1 2013   Q1 2013  Q2 2012   Q2 2012
    Million US$)        Net    Operating   Net    Operating   Net    Operating
                      Revenues  Income   Revenues  Income   Revenues  Income
                                (Loss)             (Loss)             (Loss)
Sense & Power and
Automotive Products    1,209      42      1,127      58      1,156      97
(SPA)
Embedded Processing
Solutions including     824      (106)     867      (210)     981      (233)
Wireless product line
(EPS)^(a)
Others ^(b)(c)           12      (43)       15      (129)      11      (71)
TOTAL                  2,045     (107)    2,009     (281)    2,148     (207)



^(a) Embedded Processing Solutions includes the Wireless product line which
includes a portion of sales and operating results of ST-Ericsson as
consolidated in the Company's revenues and operating results, as well as other
items affecting operating results related to the wireless business.
^(b)Net revenues of "Others" includes revenues from sales of Subsystems,
assembly services and other revenues.
^(c) Operating income (loss) of "Others" includes items such as unused
capacity charges, impairment, restructuring charges and other related closure
costs, phase out and start-up costs, and other unallocated 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 the Subsystems and Other Products Group. "Others" includes $2 million, $24
million and $16 million of unused capacity charges in the second and first
quarters of 2013 and second quarter of 2012, respectively; and $43 million,
$101 million and $56 million of impairment, restructuring charges and other
related closure costs in the second and first quarters of 2013 and second
quarter of 2012, respectively.

Sense & Power and Automotive Products (SPA) second quarter net revenues
increased 7.3% sequentially, mainly driven by Industrial and Power products
and Automotive. SPA revenues increased 4.6% compared to the year-ago quarter
driven by MEMS. SPA operating margin was 3.5% in the 2013 second quarter
compared to 5.1% and 8.3% in the prior and year-ago quarter, respectively,
with the decrease principally driven by resources deployed from ST-Ericsson to
strengthen R&D activities and price pressure within the Analog, MEMS and
Sensors (AMS) group. 

Embedded Processing Solutions (EPS) second quarter net revenues decreased 5.0%
and 16.0% on a sequential and year-over-year basis, respectively, due to a
significant decrease in ST-Ericsson sales and to a lesser extent, Digital
Convergence (DCG). EPS segment operating margin improved to negative 12.8% in
the 2013 second quarter, from negative 24.2% and negative 23.7% in the prior
and year-ago quarter, respectively, mainly due to a significant reduction in
expenses.

Cash Flow and Balance Sheet Highlights

Free cash flow* was negative $134 million in the second quarter, principally
reflecting anticipated cash resources to fund ST-Ericsson, compared to
negative $65 million in the prior quarter.

Capital expenditure payments, net of proceeds from sales, were $121 million
during the second quarter of 2013 compared to $111 million in the prior
quarter.

Inventory increased by $30 million to $1.34 billion at quarter end. Inventory
in the second quarter of 2013 was at 4.1 turns or 88 days, substantially flat
compared to the prior quarter.

As expected, ST's net financial position* decreased in the second quarter to a
net cash position of $954 million at June 29, 2013, adjusted by $145 million
of ST-Ericsson's debt to our joint venture partner, compared to $1.1 billion
at March 30, 2013. ST's financial resources equaled $1.77 billion and total
debt was $964 million at June 29, 2013.

-----
(*)Free cash flow and net financial position are non-U.S. GAAP measures. For
additional information and reconciliation to U.S. GAAP, please refer to
Attachment A.

Total equity, including non-controlling interest, was $5.68 billion at quarter
end.

First Half 2013 Results

Net revenues decreased 2.6% to $4.05 billion from $4.16 billion in the
year-ago period mainly reflecting lower ST-Ericsson sales. Net revenues for
the first half of 2013, excluding the Wireless product line, increased 2.5% to
$3.62 billion.

Gross margin was 32.1% of net revenues, compared to 32.0% of net revenues for
the 2012 first half. The first half 2013 gross margin was impacted by
unsaturation charges of $26 million compared to $87 million in the year-ago
period. Net loss, as reported, was $322 million in the first half of 2013, or
$(0.36) per share, compared to a net loss of $252 million, or $(0.28) per
share in the first half of 2012.On an adjusted basis, net of related taxes,
ST reported a non-U.S. GAAP net loss per share of $(0.19) excluding
impairment, restructuring charges and one-time items in the first half of
2013, the same as in the first half of 2012.*

The effective average exchange rate for the Company was approximately $1.30 to
€1.00 for the first half of 2013, compared to $1.32 to €1.00 for the first
half of 2012.

First Half Revenue and Operating Results by Product Segment



     Operating Segment       First Half  First Half   First Half  First Half
      (In Million US$)          2013        2013         2012        2012
                                Net       Operating      Net       Operating
                              Revenues  Income (Loss)  Revenues  Income (Loss)
Sense & Power and Automotive
Products                       2,337         99         2,263         190
(SPA)
Embedded Processing
Solutions including            1,692        (316)       1,882        (527)
Wireless product line
(EPS)
Others                          26         (171)         20         (222)
TOTAL                         4,055        (388)       4,165        (559)



Third Quarter 2013 Business Outlook

Mr. Bozotti stated, "Macro trends remain uncertain but excluding ST-Ericsson,
we have seen a progressive improvement in bookings in the second quarter,
although, towards the end of the second quarter, we experienced a softening in
the smartphone market also impacting ST products. 

"We continue to expect the ramp of key products in MEMS, Automotive,
Microcontrollers and Imaging in the second half of this year, leading to
higher sequential revenue results for both the third and fourth quarters of
this year.

"In combination, we expect third quarter net revenues, excluding Wireless
product line, to increase about 3.5% at the midpoint. Including Wireless
product line, we expect overall revenues to be about flat sequentially at the
midpoint of our guidance. We again expect significant reductions in operating
expenses in the third quarter and we are well aligned to achieve our net
operating expenses target range of $600 million to $650 million in the first
quarter of 2014. Furthermore, with the closing of the ST-Ericsson transaction
in early August, the remaining ST-Ericsson activities will be deconsolidated.
-----
* Adjusted net earnings per share is a non-US GAAP measure. For additional
information and reconciliation to U.S. GAAP, please refer to Attachment A.

"As we look ahead, we anticipate progressive improvement in our gross margin.
First, with fab utilization at a more stable and optimal level we plan to
continue to grow our business in our targeted growth drivers. Second, we are
focused on better utilizing and optimizing our technology portfolio. Third, we
are now in a position to more aggressively manage our product mix in order to
prune lower margin products from our portfolio. To successfully achieve this,
we will make gradual structural changes to our manufacturing footprint to
ensure that it matches our needs, complemented by our foundry sourcing. As a
result, we plan to gradually expand 8-inch capacity while winding down certain
6-inch manufacturing lines in Singapore and Catania, Italy and consolidate our
back-end activities in China to Shenzhen."

"Finally, to support our proprietary R&D activities for CMOS derivative
technology investments, we recently signed an important frame agreement with
the French Government for the 'Nano2017' program."

The Company expects third quarter 2013 revenues to be about flat on a
sequential basis, plus or minus 3.5 percentage points. Gross margin in the
third quarter is expected to be about 33.5%, plus or minus 2.0 percentage
points.

This outlook is based on an assumed effective currency exchange rate of
approximately $1.30 =€1.00 for the 2013 third quarter and includes the impact
of existing hedging contracts. The third quarter will close on September 28,
2013.

Recent Corporate Developments

On April 22, ST announced the appointment of Martine Verluyten as Chair of the
Audit Committee of the ST Supervisory Board, succeeding Tom de Waard.
Verluyten has been a member of the ST Supervisory Board and has served on its
Audit Committee since May 2012.

On May 22, the Company announced that Executive Vice President Jean-Marc Chery
had been appointed General Manager of the Embedded Processing Solutions
Segment, a new position, and Vice-Chairman of the Corporate Strategic
Committee where he has been a Member since 2008. Chery continues to lead the
Packaging and Test Manufacturing and Quality functions for ST.

On May 28, ST announced that ST-Ericsson, a 50-50 joint venture with Ericsson
that the parent Companies are winding down, had sold the assets and
intellectual property rights (IPR) associated with its mobile connectivity
Global Navigation Satellite System (GNSS) to a leading semiconductor company.

On June 17, ST announced that it had signed a comprehensive agreement with
Rambus Inc. expanding existing licenses between the two Companies, settling
all outstanding claims, and committing both organizations to explore
additional opportunities for collaboration. The multifaceted agreement gives
Rambus access to ST's Fully-Depleted Silicon On Insulator (FD-SOI)
process-technology design environment while giving ST secured license terms
from the Cryptography Research, Inc. (CRI) division of Rambus that makes it
possible for ST to expand deployment of security technology for banking,
identity, PayTV, video gaming, smartphones, and government, across a wider
range of products.

On June 21, ST announced that all the resolutions proposed by the Supervisory
Board were approved at the Company's Annual General Meeting (AGM), which was
held in Amsterdam.

The main resolutions approved by the shareholders were:

  *The adoption of the Company's 2012 Statutory Annual Accounts prepared in
    accordance with International Financial Reporting Standards (IFRS);

  *The distribution, in line with the Dividend Policy of the Company, of a
    semi-annual cash dividend per common share of US$0.10 in the second
    quarter of 2013 and US$0.10 in the third quarter of 2013, to be paid in
    June and September of 2013, respectively, to shareholders of record in the
    month of each quarterly payment;

  *The appointment of Ms. Janet Davidson as a new member of the Supervisory
    Board for a three-year term, expiring at the 2016 AGM, as a replacement
    for Mr. Raymond Bingham, whose mandate has expired;

  *The reappointment of Mr. Alessandro Ovi as member of the Supervisory Board
    for a three-year term, expiring at the 2016 AGM;

  *The amendment of the compensation scheme of the Supervisory Board;

  *The approval of a new four-year Unvested Stock Award Plan for Management
    and Key Employees.

On May 21, ST announced its leadership of Places2Be, a 3-year, €360M
advanced-technology pilot-line project with the participation of 18 other
leading European companies and academic institutions to support the
industrialization of Fully-Depleted Silicon-On-Insulator (FD-SOI)
microelectronics technology. Places2Be ("Pilot Lines for Advanced CMOS
Enhanced by SOI in 2x nodes, Built in Europe") aims to support the deployment
of an FD-SOI pilot line at 28nm and the subsequent node, as well as a dual
source that will enable volume manufacturing in Europe. Places2Be will drive
the creation of a European microelectronics design ecosystem using this FD-SOI
platform and explore the path towards the next step for this technology
(14/10nm).

Q2 2013 - Product and Technology Highlights

During the quarter, ST made strong progress with important new-product
introductions and significant design wins.

Sense & Power and Automotive Products (SPA)

Analog, MEMS and Sensors (AMS)

  *Deployment of the SPIRIT1, sub-GHz RF transceiver-based application for
    remote control of street lights has begun along the river Seine in Paris.
  *Earned design-ins for Pulser IC in portable ultrasound imaging equipment.
  *Passed security certification by NDS for ST8034 smart-card interface, a
    necessary step in the expansion of ST's smart-card presence in the set-top
    box market.
  *Captured a major socket in a 1^st-tier customer in the glucose-metering
    market with a dedicated op amp, reinforcing our best-in-class capabilities
    and positioning in the analog segment.
  *Collected a win for a high-end digital top-port microphone in a new tablet
    to be launched this fall.
  *Achieved milestone shipment rate of 10Munits/quarter for Fuel-Gauge
    battery-monitor IC.
  *Ramping production of 6-axis accelerometer and gyroscope for a
    high-profile launch by a major phone manufacturer.
  *Achieved significant qualifications for 6-axis accelerometer and gyroscope
    and 6-axis accelerometer and compass for important phone manufacturers.
  *In production with 9-axis inertial module for several innovative
    navigation-related applications from top-tier Americas manufacturers.

Industrial and Power Discretes (IPD)

  *Building momentum for MOSFETs with a qualification from a top
    switched-mode power supply (SMPS) maker and captured design wins with
    important leaders for lighting and charger applications in China and South
    Asia.
  *Achieved big wins for IGBTs (Insulated Gate Bipolar Transistors) with a
    large Asian welding customer and with Intelligent Power Modules for
    air-conditioning and motor-control applications.
  *Earned design wins in several server SMPS platforms with ViperPlus
    high-voltage converters from a major Taiwanese SMPS manufacturer.
  *Gaining market traction with the innovative digital-power STLUX385x
    platform for various projects with wins in major EMEA lighting customers.
  *Captured design wins from major German factory automation customers with
    newest octal intelligent power switch.
  *Earned wins for RF antenna-tuner solution for smartphones from a leading
    Taiwanese OEM.
  *Won new socket for the new field-effect rectifier diodes for mobile and
    tablet chargers at a leading Asian OEM.

Automotive (APG)

  *Earned an important award for a microcontroller companion chip that
    integrates all key functions for stability-control systems for the Korean
    market from a leading Korean supplier.
  *Captured a design win from a global leader in the braking market for a
    fully integrated electronic parking-brake solution.
  *Reinforced leadership in Infotainment with the awarding of a
    multi-standard digital terrestrial tuner from a leading European Tier 1.
  *Won several awards for VIPower smart-power technology in Body Control
    Modules from leading global Tier 1s and earned a socket from another
    leading European Tier 1 for our 32-bit automotive microcontrollers for an
    airbag application.

Embedded Processing Solutions (EPS)

Microcontroller, Memory and Secure MCU (MMS)

  *Continued STM32 momentum with several design wins for the STM32 family for
    smart-watch applications at major global OEMs, as a sensor-hub in various
    mobile applications at a major manufacturer, and in a next-generation
    low-power fitness-monitoring system at a key Americas OEM.
  *Ramped production of STM32 controllers for Wi-Fi modules for Internet of
    Things applications at various customers.
  *Earned a win from a leading home-appliance manufacturer for our
    dual-interface memory / dynamic NFC RFID tag in a washing machine.
  *Captured the prestigious 'Electron d'Or 2013' award from ElectroniqueS
    Magazine for the ST31, the first 32-bit Contactless Secure
    Microcontroller.

Digital Convergence (DCG)

  *Continued building momentum for ASICs to be manufactured in 28nm FD-SOI
    technology, with two new design wins for networking and consumer
    applications.
  *Maintained success with worldwide customers of awards for new set-top box
    Class2 product family, which has now also obtained the full certification
    from Nagra and Viaccess.
  *Began an important design at a key customer for the US cable modem based
    on theOrly/STiD platform.
  *Captured multiple design-ins of DisplayPort smart connectivity products in
    various applications, including 4Kx2K TV, the first TV
    withDisplayPortinput, at a large global consumer manufacturer.

Imaging, Bi-CMOS, ASIC and Silicon Photonics (IBP)

  *Won a slot for the Image Signal Processor from a leading phone
    manufacturer.
  *Secured design wins for ASICs using Silicon Photonics with two of the
    world's top optical communications manufacturers.
  *Collected a broad range of design wins from many customers that use ST
    BiCMOS or Silicon Photonics process technology in almost 30 new ASIC
    projects.

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

This press release contains supplemental non-U.S. GAAP financial information,
including operating income (loss) before impairment, restructuring and
one-time items, operating margin before impairment, restructuring and one-time
items, operating margin before impairment, restructuring and one-time items
attributable to ST, adjusted net earnings, adjusted net earnings per share,
free cash flow, net financial position and net financial position, adjusted to
account for 50% investment in ST-Ericsson.

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 by other
companies.

See Attachment A of this press release for a reconciliation of the Company's
non-U.S. GAAP financial measures to their corresponding U.S. GAAP financial
measures. To compensate for these limitations, the supplemental non-U.S. GAAP
financial information should not be read in isolation, but only in conjunction
with the Company's consolidated financial statements prepared in accordance
with U.S. GAAP.

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:

  *uncertain macro-economic and industry trends;
  *customer demand and acceptance for the products which we design,
    manufacture and sell;
  *unanticipated events or circumstances which may either impact our ability
    to execute the planned reductions in our net operating expenses and / or
    meet the objectives of our R&D Programs which benefit from public funding;
  *future events or circumstances which may require us to reassess our
    current plans concerning the break up and wind down of our ST-Ericsson
    joint venture;
  *the loading and the manufacturing performances of our production
    facilities;
  *the functionalities and performance of our IT systems, which support our
    critical operational activities including manufacturing, finance and
    sales;
  *variations in the foreign exchange markets and, more particularly, in the
    rate of the U.S. dollar exchange rate as compared to the Euro and the
    other major currencies we use for our operations;
  *the impact of intellectual property ("IP") claims by our competitors or
    other third parties, and our ability to obtain required licenses on
    reasonable terms and conditions;
  *restructuring charges and associated cost savings that differ in amount or
    timing from our estimates;
  *changes in our overall tax position as a result of changes in tax laws,
    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;
  *the outcome of ongoing litigation as well as the impact of any new
    litigation to which we may become a defendant;
  *natural events such as severe weather, earthquakes, tsunami, volcano
    eruptions or other acts of nature, health risks and epidemics in locations
    where we, our customers or our suppliers operate;
  *changes in economic, social, political or infrastructure conditions in the
    locations where we, our customers or our suppliers operate including as a
    result of macro-economic or regional events, military conflict, social
    unrest or terrorist activities;
  *availability and costs of raw materials, utilities, third-party
    manufacturing services, or other supplies required by our operations;

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 risk factors 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, 2012, as filed with the SEC on March 4,
2013. 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 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.

STMicroelectronics Conference Call and Webcast Information

On July 23, 2013, the management of STMicroelectronics will conduct a
conference call to discuss the Company's operating performance for the second
quarter of 2013.

The conference call will be held at 9:00 a.m. U.S. Eastern Time / 3:00 p.m.
CET. The conference call will be available live via the Internet by accessing
http://investors.st.com. Those accessing the webcast should go to the Web site
at least 15 minutes prior to the call, in order to register, download, and
install any necessary audio software. The webcast will be available until
August 2, 2013.

About STMicroelectronics
ST is a global leader in the semiconductor market serving customers across the
spectrum of sense and power and automotive products and embedded processing
solutions. From energy management and savings to trust and data security, from
healthcare and wellness to smart consumer devices, in the home, car and
office, at work and at play, ST is found everywhere microelectronics make a
positive and innovative contribution to people's life. By getting more from
technology to get more from life, ST stands for life.augmented.

In 2012, the Company's net revenues were $8.49 billion. Further information on
ST can be found at www.st.com.

                              (tables attached)

For further information, please contact:

INVESTOR RELATIONS:
Tait Sorensen    
Group VP, Investor Relations
STMicroelectronics
Tel: +1 602 485 2064
tait.sorensen@st.com

MEDIA RELATIONS:
Nelly Dimey    
Director, Corporate Media and Public Relations
STMicroelectronics
Tel: +33 158 077 785
nelly.dimey@st.com

STMicroelectronics N.V.
Consolidated Statements of Income
(in millions of U.S. dollars, except
per share data ($))
                                                 Three Months Ended
                                           (Unaudited)         (Unaudited)
                                                  June 29,            June 30,
                                                      2013                2012
Net sales                                                  
                                                    2,034              2,140
Other revenues                                            
                                                     11                8
 NET REVENUES                                            
                                                    2,045               2,148
Cost of sales                                               
                                                  (1,373)             (1,412)
 GROSS PROFIT                                            
                                                     672                736
Selling, general and administrative                       
                                                    (285)              (292)
Research and development                                  
                                                    (453)              (617)
Other income and expenses, net                            
                                                     2                22
Impairment, restructuring charges and                     
other related closure costs                         (43)              (56)
 Total Operating Expenses                                
                                                    (779)              (943)
 OPERATING LOSS                                          
                                                    (107)              (207)
Interest income (expense), net                            
                                                     7              (6)
Income (loss) on equity-method                            
investments                                         (89)              (2)
LOSS BEFORE INCOME TAXES                                  
                                                    (189)              (215)
 AND NONCONTROLLING INTEREST
Income tax benefit (expense)                              
                                                     16              (20)
 NET LOSS                                                
                                                    (173)              (235)
Net loss (income) attributable to                         
noncontrolling interest                              21                160
 NET LOSS ATTRIBUTABLE TO PARENT                         
COMPANY                                             (152)              (75)
 EARNINGS PER SHARE (BASIC)                              
ATTRIBUTABLE TO PARENT COMPANY                     (0.17)              (0.08)
STOCKHOLDERS
 EARNINGS PER SHARE (DILUTED)                            
ATTRIBUTABLE TO PARENT COMPANY                     (0.17)              (0.08)
STOCKHOLDERS
 NUMBER OF WEIGHTED AVERAGE
 SHARES USED IN CALCULATING
 EARNINGS PER SHARE                                 889.0               886.1

STMicroelectronics N.V.
Consolidated Statements of Income
(in millions of U.S. dollars, except
per share data ($))
                                                  Six Months Ended
                                           (Unaudited)         (Unaudited)
                                                  June 29,            June 30,
                                                      2013                2012
Net sales                                                   
                                                     4,037               4,150
Other revenues                                            
                                                     18                15
 NET REVENUES                                            
                                                    4,055              4,165
Cost of sales                                               
                                                  (2,755)             (2,833)
 GROSS PROFIT                                            
                                                    1,300               1,332
Selling, general and administrative                       
                                                    (564)              (602)
Research and development                                   
                                                    (986)             (1,250)
Other income and expenses, net                            
                                                     6                35
Impairment, restructuring charges and                     
other related closure costs                         (144)              (74)
 Total Operating Expenses                                  
                                                  (1,688)             (1,891)
 OPERATING LOSS                                          
                                                    (388)              (559)
Interest expense, net                                     
                                                     -              (19)
Loss on equity-method investments                         
                                                    (102)              (9)
Gain on financial instruments, net                        
                                                     -                3
 LOSS BEFORE INCOME TAXES                                
                                                    (490)              (584)
 AND NONCONTROLLING INTEREST
Income tax benefit                                        
                                                     21                14
 NET LOSS                                                
                                                    (469)              (570)
Net loss (income) attributable to                         
noncontrolling interest                              147                318
 NET LOSS ATTRIBUTABLE TO PARENT                         
COMPANY                                             (322)              (252)
 EARNINGS PER SHARE (BASIC)                              
ATTRIBUTABLE TO PARENT COMPANY                     (0.36)              (0.28)
STOCKHOLDERS
 EARNINGS PER SHARE (DILUTED)                            
ATTRIBUTABLE TO PARENT COMPANY                     (0.36)              (0.28)
STOCKHOLDERS
 NUMBER OF WEIGHTED AVERAGE
 SHARES USED IN CALCULATING
 EARNINGS PER SHARE                                 888.5               885.5

STMicroelectronics N.V.
CONSOLIDATED BALANCE SHEETS
As at                                      June 29,    March 30,  December 31,
In millions of U.S. dollars                  2013        2013         2012
                                          (Unaudited) (Unaudited)   Audited
ASSETS
Current assets:
Cash and cash equivalents                       1,583       1,718        2,250
Short-term deposits                                 1           1            1
Marketable securities                             189         187          238
Trade accounts receivable, net                  1,118       1,025        1,005
Inventories                                     1,336       1,306        1,353
Deferred tax assets                               224         141          137
Assets held for sale                               28          37            -
Other current assets                              567         501          518
Total current assets                            5,046       4,916        5,502
Goodwill                                          135         140          141
Other intangible assets, net                      250         208          213
Property, plant and equipment, net              3,276       3,275        3,481
Non-current deferred tax assets                   395         439          414
Restricted cash                                     -           4            4
Long-term investments                              29         110          119
Other non-current assets                          512         540          560
                                                4,597       4,716        4,932
Total assets                                    9,643       9,632       10,434
LIABILITIES AND EQUITY
Current liabilities:
Short-term debt                                   313         250          630
Trade accounts payable                            985         862          797
Other payables and accrued liabilities            993         997          942
Dividends payable to stockholders                  94           -           89
Deferred tax liabilities                            1          11           11
Accrued income tax                                 65          77           86
Total current liabilities                       2,451       2,197        2,555
Long-term debt                                    651         647          671
Post-retirement benefit obligations               492         474          477
Long-term deferred tax liabilities                 15          15           14
Other long-term liabilities                       357         351          353
                                                1,515       1,487        1,515
Total liabilities                               3,966       3,684        4,070
Commitment and contingencies
Equity
Parent company stockholders' equity
Common stock (preferred stock:                  1,156       1,156        1,156
540,000,000 shares authorized, not
issued; common stock: Euro 1.04 nominal
value, 1,200,000,000 shares authorized,
910,622,305 shares issued, 890,459,183
shares outstanding)
Capital surplus                                 2,564       2,559        2,555
Retained earnings                               1,433       1,788        1,959
Accumulated other comprehensive income            749         673          794
Treasury stock                                  (213)       (239)        (239)
Total parent company stockholders' equity       5,689       5,937        6,225
Noncontrolling interest                          (12)          11          139
Total equity                                    5,677       5,948        6,364
Total liabilities and equity                    9,643       9,632       10,434

STMicroelectronics N.V.
SELECTED CASH FLOW DATA
Cash Flow Data (in US$ millions)         Q2 2013         Q1 2013       Q2 2012
Net Cash from (used in) operating                       
activities                                15           66        (37)
Net Cash used in investing                              
activities                                (146)           (81)        (199)
Net Cash from (used in) financing                       
activities                                (12)           (481)        33
Net Cash decrease                                        
                                          (135)          (532)        (253)
Selected Cash Flow Data (in US$          Q2 2013         Q1 2013       Q2 2012
millions)
Depreciation & amortization                           237           281
                                          224
Net payment for Capital                                 
expenditures                              (121)           (111)        (70)
Dividends paid to stockholders*                         
                                          (75)           (89)        (89)
Change in inventories, net                              
                                          (18)           30        (21)
* The amount paid in Q2 2013 does not include the American
investors, paid in July 2013.

((Attachment A)

                              STMicroelectronics
               Supplemental Non-U.S. GAAP Financial Information
                  U. S. GAAP - Non-U.S. GAAP Reconciliation
                     In Million US$ Except Per Share Data

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.

Operating income (loss) before, impairment, restructuring and one-time items
is used by management to help enhance an understanding of ongoing operations
and to communicate the impact of the excluded items, such as impairment,
restructuring charges and other related closure costs. Adjusted net earnings
and earnings per share (EPS) are used by management to help enhance an
understanding of ongoing operations and to communicate the impact of the
excluded items like impairment, restructuring charges and other related
closure costs attributable to ST and other one-time items, net of the relevant
tax impact.

Operating income (loss) before impairment, restructuring and one-time items
attributable to ST is calculated as operating income (loss) before impairment,
restructuring and one-time items excluding 50% of ST-Ericsson operating
income (loss) before impairment, restructuring and one-time items as
consolidated by ST. Operating margin before impairment, restructuring and
one-time items attributable to ST is calculated as operating income (loss)
before restructuring attributable to ST divided by reported revenues excluding
50% of ST-Ericsson revenues as consolidated by ST.

The Company believes that these non-GAAP financial measures provide useful
information for investors and management because they measure the Company's
capacity to generate profits from its business operations, excluding the
effect of acquisitions and expenses related to the rationalizing of its
activities and sites that it does not consider to be part of its on-going
operating results, thereby offering, when read in conjunction with the
Company's GAAP financials, (i)the ability to make more meaningful
period-to-period comparisons of the Company's on-going operating results,
(ii)the ability to better identify trends in the Company's business and
perform related trend analysis, and (iii)an easier way to compare the
Company's results of operations against investor and analyst financial models
and valuations, which usually exclude these items.

Q2 2013                    Gross    Operating
(US$  millions  and  cents Profit Income (loss) Net Earnings Corresponding EPS
per share)
U.S. GAAP                   672       (107)        (152)          (0.17)
Impairment & Restructuring             43            41
Loss on equity-method                                69
investments (3Sun)
Estimated Income Tax                                (11)
Effect
Non-U.S GAAP                672       (64)          (53)          (0.06)

Q1 2013                        Gross    Operating     Net
(US$ millions  and  cents  per Profit Income (loss) Earnings Corresponding EPS
share)
U.S. GAAP                       628       (281)      (171)        (0.19)
Impairment & Restructuring                 101         58
Estimated Income Tax Effect                           (3)
Non-U.S GAAP                    628       (180)      (116)        (0.13)

Q2 2012                        Gross    Operating     Net
(US$ millions  and  cents  per Profit Income (loss) Earnings Corresponding EPS
share)
U.S. GAAP                       736       (207)       (75)        (0.08)
Impairment & Restructuring                 56          28
Estimated Income Tax Effect                            -
Non-U.S GAAP                    736       (151)       (47)        (0.05)

                                      
         (continued)

(Attachment A - continued)   

Net financial position: resources (debt), represents the balance between our
total financial resources and our total financial debt. Our total financial
resources include cash and cash equivalents, marketable securities, short-term
deposits and restricted cash, and our total financial debt includes short-term
borrowings, current portion of long-term debt and long-term debt, all as
reported in our consolidated balance sheet. We believe our net financial
position provides useful information for investors because it gives evidence
of our global position either in terms of net indebtedness or net cash
position by measuring our capital resources based on cash, cash equivalents
and marketable securities and the total level of our financial indebtedness.
Net financial position is not a U.S. GAAP measure.

Net Financial Position (in US$  June 29, 2013 March 30, 2013 December 31, 2012
millions)
Cash and cash equivalents           1,583         1,718            2,250
Marketable securities                189           187              238
Short-term deposits                   1             1                1
Non-current restricted cash           -             4                4
Total financial resources           1,773         1,910            2,493
Short-term borrowings and
current portion of                  (313)         (250)            (630)

long-term debt
Long-term debt                      (651)         (647)            (671)
Total financial debt                (964)         (897)           (1,301)
Net financial position               809          1,013            1,192
Net financial position,
adjusted to account for 50%          954          1,096            1,192

investment in ST-Ericsson

Free cash flow is defined as net cash from operating activities minus net cash
from (used in) investing activities, excluding purchase of and proceeds from
the sale of marketable securities, short term deposits and release of
restricted cash. We believe 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 operating
activities. Free cash flow is not a U.S. GAAP measure and does not represent
total cash flow since it does not include the cash flows generated by or used
in financing activities. In addition, our definition of free cash flow may
differ from definitions used by other companies.

Free cash flow (in US$ millions)                       Q2 2013 Q1 2013 Q2 2012
Net cash from (used in) operating activities             15      66     (37)
Net cash from (used in) investing activities            (146)   (81)    (199)
Payment for purchases of (proceeds from sale of)
marketable securities, short term deposits and           (3)    (50)     107
restricted cash, net
Free cash flow                                          (134)   (65)    (129)

                                   --end---

ST Q2 2013 results

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