|Based on seeing this dialog, just went through the 2011 annual report... |
STM is a complex company but it is not over levered in any sense of the word.
Here is an outtake from the report...me thinks this outtake captures the main complexity they face....
Our major customers include Apple, Bosch, Cisco, Continental, Delta, Denso, Ericsson, Hewlett-Packard, Hitachi,
Marelli, Motorola, Nokia, Pace, Panasonic, Philips, Research in Motion, Samsung, Seagate, Sony / Sony Ericsson
and Western Digital. We also sell our products through distributors and retailers, including Arrow Electronics,
Avnet, Tomen and Yosun. The semiconductor industry has historically been a cyclical one and we have
responded through emphasizing balance in our product portfolio, in the applications we serve, and in the
regional markets we address.
Although cyclical changes in production capacity in the semiconductor industry and demand for electronic
systems have resulted in pronounced cyclical changes in the level of semiconductor sales and fluctuations in
prices and margins for semiconductor products from time to time, the semiconductor industry has experienced
substantial growth over the long-term. Factors that contribute to long-term growth include the development of
new semiconductor applications, increased semiconductor content as a percentage of total system cost,
emerging strategic partnerships and growth in the electronic systems industry, in particular, the Asia Pacific
We offer a broad and diversified product portfolio and develop products for a wide range of market applications
to reduce our dependence on any single product, application or end market. Within our diversified portfolio, we
have focused on developing products that leverage our technological strengths in creating customized, systemlevel
solutions with high-growth digital and mixed-signal content. Our product families are comprised of
differentiated application-specific products (we define as being our dedicated analog, mixed-signal and digital
application-specific standard products (“ASICs”) and application-specific standard products (“ASSP”) offerings
and semi-custom devices) that were organized under our Automotive, Consumer, Computer and
Communication Infrastructure (“ACCI”), Wireless (“Wireless”), Analog, MEMS and Microcontrollers (“AMM”)
and Power Discrete Products (“PDP”) segments.
Our products are manufactured and designed using a broad range of manufacturing processes and proprietary
design methods. We use all of the prevalent function-oriented process technologies, including CMOS, bipolar
and nonvolatile memory technologies. In addition, by combining basic processes, we have developed advanced
systems-oriented technologies that enable us to produce differentiated and application-specific products,
including bipolar CMOS technologies (“BiCMOS”) for mixed-signal applications, and diffused metal-on silicon
oxide semiconductor (“DMOS”) technology and bipolar, CMOS and DMOS (“BCD technologies”) for intelligent
power applications, MEMS and embedded memory technologies. This broad technology portfolio, a
cornerstone of our strategy for many years, enables us to meet the increasing demand for SoC and
System-in-Package (“SiP”) solutions. Complementing this depth and diversity of process and design technology
is our broad IP portfolio that we also use to enter into broad patent cross-licences.