STMicroelectronics reported its third-quarter results on October 29, 2026, for the quarter ended September 26, and raised its AI data centre revenue forecast to about $1.3 billion for 2026, up from more than $1 billion projected in July. Its 2027 goal remains well above $2 billion. These figures are company projections, not revenue already booked.
Quarterly net revenue was $3.76 billion, up 17.9% year over year, with gross margin of 37.3%, versus 33.2% a year earlier. Operating income was $367 million under US GAAP and $429 million on a non-GAAP basis, nearly double the year-earlier figure and above the $400.5 million expected by analysts polled by LSEG, according to Reuters. Net income was $291 million, or $0.31 per diluted share.
Why silicon photonics matters
CEO Jean-Marc Chery said demand was driven mainly by silicon photonics chips, which use light rather than electrical signals to move data between servers. The company says demand remains well above supply and that it continues to expand capacity. Its PIC100 platform is already in volume production on 300 mm wafers at Crolles, France, supports 800 Gb/s and 1.6 Tb/s optical modules at 200 Gbps per lane in PAM4, and capacity is set to more than quadruple by 2027.
Fourth-quarter outlook
For the fourth quarter, ST guides to revenue of $4.15 billion at the midpoint, plus or minus 3.5%, and gross margin of about 39.0%. At the midpoint, that would take full-year 2026 revenue to about $14.5 billion, up 22.8% from 2025. The company also cited the cyclical recovery, demand from low-Earth-orbit satellite operators and growth in communication equipment and personal electronics. CFO Lorenzo Grandi said ST is raising prices on selected products amid tight supply and rising input costs.
Image credit: STMicroelectronics fab in Crolles, France, where the PIC100 platform is produced. Photo: Semiconductor Today.
Sources: STMicroelectronics (official release); Reuters; STMicroelectronics — silicon photonics.
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