ST boosts capex to $2.2bn
Increased expenses were seen under the headings of "selling, general and administrative" ($230mn, compared with $174mn) and "research and development" ($363mn, compared with $283mn). Lower margins were further blamed on the reduced value of the US dollar.
CEO Pasquale Pistorio reports: "In response to current industry dynamics, and reflecting our longer term view of ST’s market positioning, we have decided to increase 2004 capital expenditure to approximately $2.2bn, from the $1.6bn that we initially budgeted. Approximately two-thirds of this amount will be allocated to leading-edge technologies and R&D programmes."
The company expects year-on-year growth in the range 26-33% for Q2 revenues. Market drivers will be automotive, consumer and industrial. Flash memory is also expected to do well.
