24 Jan 2012

ST-Ericsson CEO admits challenges

Following fourth quarter financial results, Didier Lamouche, ST-Ericsson President and CEO, predicts tough times ahead.

"From a financial perspective, it is clear that sales and operating results will continue to be challenging over the coming quarters, due to the reduction in the short term of new product sales with one of our largest customers [Nokia]," he said.

"Our immediate priority is to build a strong roadmap to profitability based on enhancing execution, delivering in volume our leading products and lowering the break-even point," he added. "Our focus is to effectively deliver on timely execution of our strategic programs and continue to proliferate design wins."

Sales in the fourth quarter, ending December 31, 2011 and excluding IP licensing to a third party, grew 1.3% over the prior quarter while operating losses were higher. Net loss was $231 million compared with a $177 million loss in the year-ago quarter.

Despite challenges, the business achieved record revenues for automotive applications and MEMS. Didier Lamouche is the venture's third chief executive since it formed in 2009.

• ST-Ericsson is a key supplier for Nokia's Symbian platform: it has suffered as Nokia loses out to Apple and Google in the smartphone market and by a decision earlier this year to swap Symbian for Microsoft software.

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