ST to exit ST-Ericsson mobile chip venture
STMicroelectronics is to quit its loss making mobile chip joint venture with Ericsson by the third quarter of 2013, as part of a new strategic plan to improve its financial situation.
In a conference call this morning, the company's ceo Carlo Bozotti, pictured, told analysts that ST would focus on five key product areas: MEMS and sensors, smart power, automotive electronics, microcontrollers and application processors for digital consumer.
As part of the reorganisation, ST will be divided into two product segment groups: sensors, smart power and automotive and embedded processing, Bozotti said.
It is hoped that the changes will reduce the company's quarterly net operating expenses from about $900million to between $600 and $650m by the beginning of 2014. The aim is to deliver operating margins of 10%.
Bozotti continued: "The new ST will be more focused, leaner and better positioned to deliver value to our customers and our shareholders, targeting to rapidly achieve operating margins of 10%."
