Performance Overview
Customers
The semiconductor industry is highly cyclical and has been subject to significant economic downturns at various times. This means performance can vary significantly from one year to the next.
| EC1: ST sales |
| |
2003 |
2004 |
2005 |
| US$m |
7,238 |
8,760 |
8,882 |
Last year our Serviceable Available Market (SAM) increased by 7% while STMicroelectronics grew by 1.4% only, losing market share in 2005 compared with 2004. However, over the last 15 years, the SAM has grown at a compound annual rate of approximately 10%, while our own annual growth has been, over the same period, close to 15%. According to various industry sources, we are a solid member of the top five semiconductor companies worldwide.
| EC2; ST7: ST sales by region* |
% |
| |
2003 |
2004 |
2005 |
| Asia-Pacific |
44.1 |
42.4 |
45.7 |
| Emerging markets |
5.8 |
6.9 |
6.6 |
| Europe |
31.9 |
32.3 |
31.4 |
| Japan |
4.6 |
4.6 |
3.5 |
| North America |
13.6 |
13.8 |
12.8 |
| (*) |
The sales are split by region of shipment of our products; in many cases, the sales process originated in another country (Europe and the USA in particular), at design level with our customers. |
Our sales have again increased in the Asia-Pacific region last year, confirming the well-known long-term trend, and leading to the creation of Greater China as a new sales and marketing region within our company. Our sales in Japan did not increase, and a new organization has been implemented to support our expansion program in this country. In both China and Japan we are expanding sales, design, and support resources to gain new customers and new applications in current customers.
We serve five main market segments: Automotive, Computer, Consumer, Industrial and Telecom.
| STE9: Sales by market segment |
% |
| |
2003 |
2004 |
2005 |
| Automotive |
14 |
15 |
16 |
| Computer |
18 |
16 |
17 |
| Consumer |
20 |
21 |
18 |
| Industrial |
15 |
16 |
14 |
| Telecom |
33 |
32 |
35 |
Telecom is our primary market, and Nokia is our largest customer representing 22% of our sales in 2005; no other customer exceeds 10% of our sales. We also sell through distributors (18% of our revenues). Partnerships are integral to our business, and we have entered strategic alliances with a number of key customers such as Alcatel, Bosch, Hewlett- Packard, Marelli, Nokia, Nortel, Pioneer, Seagate, Siemens-VDO, Thomson, and Western Digital.
