FINWIRES · TerminalLIVE
FINWIRES

STMicroelectronics Shares Jump as Data Center Revenue Outlook Raised on AI Boom

By
STMicroelectronics Shares Jump as Data Center Revenue Outlook Raised on AI Boom

STMicroelectronics (STMPA.PA, STMMI.MI) shares surged in early Tuesday morning trading after the semiconductor manufacturer sharply raised its revenue outlook for its data centers segment, citing sustained demand for artificial intelligence infrastructure and continued progress in expanding capacity.

The Franco-Italian chipmaker expects data center revenue to reach $1 billion in 2026, nearly double from its previous forecast of "nicely above $500 million." For 2027, STMicroelectronics expects data center revenue to double, compared with the prior guidance of "well above $1 billion," assuming current market momentum and customer engagements continue.

The stock rose nearly 9% in both Paris and Milan following the announcement.

Management had mentioned during the first-quarter earnings call in April that the company reinforced its position as a supplier of critical semiconductors for AI data centers "from the grid to the core, and from the core to the user."

"In data center, it is clear that we are seeing a really strong growth in term of demand, acceleration, including a cloud optical interconnect, both for our PIC100, for our BiCMOS, but I repeat for our general-purpose microcontoller and Analog and Power/Discrete as well," Jean-Marc Chery, chief executive and chairman, said during the call.

Earlier this year, STMicroelectronics partnered with chipmaker Nvidia (NVD.F) to expand its AI datacenter power conversion portfolio, adding two new power conversion stages to its existing architecture. It also ramped up production of its silicon photonics-based PIC100 platform, which is used by hyperscalers for optical interconnect for data centers and AI clusters.

In February this year, it expanded its strategic collaboration with Amazon's (AMZ.F) Amazon Web Services through a multi-year, multi-billion-dollar commercial deal to enable new high performance compute infrastructure for cloud and AI data centers.

Related Articles

Activist Investor Elliott Takes AU$1 Billion Stake in Northern Star, Calls for Strategic Review
US Markets

Activist Investor Elliott Takes AU$1 Billion Stake in Northern Star, Calls for Strategic Review

Activist shareholder Elliott Investment Management has secured a AU$1 billion stake in Northern Star Resources (ASX:NST) and is using its new position to push for a strategic review that could lead to a sale of the company.Following its investment, the hedge fund published a presentation on Monday targeting the Australian mining company for what it described as "a pattern of operational missteps, cost overruns and inconsistent strategic direction." Elliott suggested Northern Star explore all strategic alternatives to boost its value, including a potential sale.Elliott said the miner should hire a "world-class external CEO" after Stuart Tonkin's recent decision to step down as managing director. Tonkin, who has also served as CEO and chief operating officer, will remain with the company until a successor is named and the KCGM Fimiston Mill expansion is commissioned.The activist investor questioned management's ability to execute the KCGM mill ramp-up and the development of the Hemi project, citing "protracted difficulties."Elliott also criticized the company's capital allocation as "inconsistent and reactive," arguing this approach has resulted in a valuation that understates Northern Star's underlying assets.Some analysts agree on the need for an overhaul. Pendal Group's Brenton Saunders concurred with most of Elliott's points, noting that the activist investor's approach is "somewhat unorthodox" but effective, Reuters reported."The company does need to be shaken up," Saunders reportedly said.In response, Northern Star said it is actively searching for a new managing director and that the KCGM mill remains on track for commissioning early in the 2027 fiscal year.The company added that its board "regularly reviews corporate opportunities," including "potential broader M&A opportunities," alongside its financial adviser, Goldman Sachs."The Northern Star Board and management team frequently engage with our shareholders to hear their perspectives and welcomes the opportunity for constructive dialogue with Elliott, as a shareholder of the company," Northern Star said.The Australian mining company's shares jumped 13% on Tuesday.

$ASX:NST
Indonesia's Trade Surplus Narrows to $89 Million in April; Exports Rebound Sharply
US Markets

Indonesia's Trade Surplus Narrows to $89 Million in April; Exports Rebound Sharply

Indonesia's trade surplus narrowed to $89.1 million in April, as strong growth in both exports and imports left the external balance positive, according to data released Tuesday by Statistics Indonesia.The consensus estimate was for a surplus of $1.50 billion, according to Investing.com.Exports rose 22% year over year to $25.3 billion in April, recovering from the 3.1% drop in March, and beating the consensus forecast for an 8.8% growth. Non-oil and gas exports increased 23.4% to $24.2 billion.Imports climbed 22.5% from a year earlier to $25.2 billion, significantly faster than the 1.51% increase in March, and against the consensus estimate for a 3.25% rise. Non-oil and gas imports rose 14.1% to $20.6 billion.The April surplus was supported by a $3.53 billion surplus in non-oil and gas trade, which offset a $3.44 billion deficit in the oil and gas sector.During the first four months of 2026, exports increased 5.5% year over year to $92.2 billion, while non-oil and gas exports rose 6.3% to $87.7 billion.Imports rose 13.4% from a year earlier to $86.5 billion in January-April, with non-oil and gas imports increasing 12.7% to $73.58 billion.Higher palm oil exports boosted manufacturing shipments during the period, while lower coal exports weighed on mining and other products.China remained Indonesia's largest non-oil and gas export market during January-April, accounting for $22.8 billion of shipments, followed by the United States at $10.2 billion and India at $6.14 billion.The trade data comes as Indonesia presses ahead with plans to centralize exports of key commodities under a new state-backed entity, a move that has raised concerns among natural resource producers over potential regulatory uncertainty.Coordinating Economic Minister Airlangga Hartarto said coal, palm oil, and ferroalloy producers will begin submitting export-related documents to PT Danantara Sumberdaya Indonesia from June 1.The company, a unit of sovereign wealth fund Danantara, is expected to assume specific export functions as early as September and no later than Jan. 1, 2027.Danantara Chief Operating Officer Dony Oskaria said the new entity would operate transparently and accountably, including in the benchmarking of commodity prices during the transition."We will ensure that this company will be run transparently and can be monitored by everyone in Indonesia," Oskaria said, according to Reuters.Indonesia is the world's largest exporter of thermal coal, palm oil, and nickel, with exports of the three commodities exceeding $65 billion last year.The government has said the initiative is intended to strengthen oversight and coordination of strategic commodity exports.

$^JKSE
Indonesian Inflation Accelerates to 3.08% in May, Topping Forecasts
US Markets

Indonesian Inflation Accelerates to 3.08% in May, Topping Forecasts

Indonesian inflation rose to 3.08% in May following a surge in food, beverage, tobacco, and personal care prices during the month, according to data from Statistics Indonesia published Tuesday.Analysts polled by Reuters estimated a rise of 2.97%. The latest print rebounded from an eight-month low of 2.42% recorded in April.Prices of food, beverages, and tobacco jumped 4.94% during the month, the statistics department, known officially as Badan Pusat Statistik, said.The commodities that helped raise food prices include fresh fish at 0.22%, rice at 0.18%, broiler chicken meat at 0.15%, as well as machine-rolled and hand-rolled clove cigarettes and white cigarettes.Prices of mineral water, oranges, and cucumbers, among others, helped contribute to the upward movement.Food and beverage services and restaurant prices jumped 2.24% year over year during the month. Rice meals with a side dish saw higher prices.Personal care services jumped 10.35% year over year during the month, driven by a 26.31% rise in other personal effects prices. according to the statistics department.Transport prices grew 2.3%, with airfares contributing a 0.14% rise, the department said.Information, communication, and financial services saw prices rise 0.97%, while health prices jumped 1.7%.On a monthly basis, consumer inflation was up 0.28%, compared with 0.13% a month earlier.The country's annual core component inflation rate was 2.59%, compared with the prior reading of 2.44%. Month over month, core consumer prices rose 0.22%, against the previous 0.23% increase.Indonesia's inflation data comes as economists doubt the robust growth narrative being pushed by President Prabowo Subianto, Bloomberg reported on May 29.Economists questioned what they called an unexpected jump in the archipelago's gross domestic product by 5.6%, calling the statistic an overstatement, the news outlet said.

$^JKSE