STMicroelectronics Shutting STB Business as It Focuses on IoT, Smartphones
STMicroelectronics is scrapping its set-top box/home gateway business after a cumulative $500 million loss over two years as it focuses on smartphones, the IoT and other digital areas. The company has reorganized operations and is targeting the connected car and…
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IoT markets, said CEO Carlo Bozotti on an earnings call. For the year, ST’s financial results fell short of expectations due largely to a weak semiconductor market and the winding down of legacy products in what Chief Financial Officer Carlo Ferro called the company’s “post-Nokia phase.” For the year, STMicroelectronics revenue was $6.9 billion below projections and down 6.8 percent from 2014, said Ferro. The decision to shut down the set-top box and home gateway business followed a turnaround plan that didn’t produce desired results, said Chief Operating Officer Jean-Marc Chery. He cited a “much slower than expected market take-off,” operator takeovers and “box manufacturers delaying rollouts,” which led to increasing competition on low-end boxes and high R&D costs. STMicroelectronics plans to “redeploy” roughly 600 employees from its set-top business to support what it called growth areas including digital automotive, Chery said. This year, job cuts are expected to affect about 1,000 employees, he said.