ST sees "anticipatory ordering" of MCUs

July 26, 2017 // By Peter Clarke
Carlo Bozotti, CEO of STMicroelectronics said in a conference call with analysts that the extreme book-to-bill ratio for orders over deliveries that his company is experiencing right now is unsustainable.

Bozotti was asked on a call to discuss ST's second quarter financial results whether there are any signs of double ordering of standard components and of microcontrollers (MCUs) in particular. A few days ago ST dismissed as false media speculation the idea that it might be suspending the taking of orders for MCUs because of an extreme backlog.

In answer to the questions Bozotti said that rather than double ordering what ST sees is anticipatory ordering, especially of MCUs, by companies wishing to make sure that they have inventory in place for the last quarter of 2017 and the first quarter of 2018.

"We know, of course, very well that the book-to-bill ratio we are experiencing is not sustainable. What we see is an effort to see there is good cover [of inventory] on a longer time frame," Bozotti said.

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