STMicro Sales Forecast Misses Estimates on Weak Chip Demand

STMicroelectronics NV forecast weaker chip demand will cut sales this quarter, missing analysts’ estimates and making it more difficult for Europe’s largest semiconductor supplier to reach a key profitability target. The stock slumped.

Third-quarter net revenue fell 6.3 percent to $1.89 billion from a year earlier, trailing analysts’ $1.92 billion average estimate. Sales in the current period will shrink about 3.5 percent from last quarter. Analysts had projected an increase. A $42 million tax benefit helped Geneva-based STMicro report its second consecutive quarter of net income.