STM slashes sales forecast in slowdown

Europe's biggest micro-chip maker, STMicroelectronics today slashed its predictions for fourth-quarter sales by as much as 18% as it said it had been hit right across its product and customer ranges.

The Swiss-based firm said sales between October and November are now likely to come in between $2.2 billion and $2.35 billion (£1.43 billion-£1.75 billion) rather than the $2.7 billion it had been forecasting only months ago.

STM, the largest supplier of chips for set-top TV boxes, said all its markets in all countries had seen a slowdown in demand, customers had made sudden and substantial changes to their orders and many had asked for orders to be delayed. The worst hit areas have been those supplying chips for mobile phones, vehicles and computer peripherals.

This is the latest in revenue and profit warnings from electronics companies. Panasonic yesterday said its profits would be 90% lower than predicted.