Mr. Bozotti stated, "Based on current visibility, we believe bookings have bottomed. Looking to the first quarter, we expect billings to bottom, as we see stronger than seasonal billings for ST's wholly-owned businesses offset by a very significantly weaker revenue performance from ST-Ericsson.

"Preliminary industry analysts' forecasts indicate that the overall semiconductor market should stabilize in 2012. For ST, we see the opportunity to continue to grow in selected markets during 2012 but we remain concerned about the macro-economic uncertainty. Consequently, we plan in the near-term to continue to maintain reduced levels of loading at our facilities. We will continue to focus on capital management, taking a prudent approach with respect to inventory levels and capital investments, with the goal of maintaining and expanding our free cash flow. In addition, we are continuing to bring to market new innovative products to drive market share gains."

Based largely upon a very significantly weaker sequential sales outlook for wireless, the Company anticipates total revenues to sequentially decrease about 4% to 10% in first quarter of 2012. As a result, and reflecting an improved, but still high level of unsaturation at our facilities, gross margin in the first quarter is expected to be about 33.0%, plus or minus 1.5 percentage points.

This outlook is based on an assumed effective currency exchange rate of approximately $1.32 = euro 1.00 for the 2012 first quarter and includes the impact of existing hedging contracts. The first quarter will close on March 31, 2012.

Corporate Developments

• In the quarter ST announced the establishment of "ST New Ventures," a corporate venture-capital fund targeting investments in technology, product and service start-up companies mainly in the Healthcare, Cleantech and Smart Infrastructure areas. The fund will enable the Company to be close to new markets where semiconductors are key and to be at the leading edge of innovation and new applications.
• In order to unlock additional growth potential, ST re-aligned its organization to ensure an even more customer-oriented approach, further increase the effectiveness of its Research and Development and manufacturing activities, and more closely associate the businesses with its vision and product strategy.
  
  With Didier Lamouche having accepted the full-time responsibility to run ST-Ericsson, all of ST's regional marketing and sales organizations now report directly to President and CEO Carlo Bozotti. Executive Vice President Paul Grimme, who had previously led ST's Automotive Product Group (APG), has moved to take on the role of General Manager Sales and Marketing Europe, the Middle East, and Africa.
  
  The importance of R&D and manufacturing to ST is highlighted by consolidating Technology R&D, Front-End Manufacturing, Packaging & Test Manufacturing, Product Quality Excellence, and Global IT under the direction of Senior Executive Vice President Jean-Marc Chery to exploit the synergies of these organizations.
  
  ST also reorganized its product groups into the Industrial and Multisegment (IMS) and Digital Sectors and a separate Automotive Product Group that reinforce the Company's vision to be the worldwide leader in Sense & Power and Multimedia Convergence. Within these groups, Benedetto Vigna has been appointed Corporate Vice President and General Manager of the Analog, MEMS, and Sensors Group and Marco Monti has been appointed Corporate Vice President and General Manager of the Automotive Product Group.

Q4 2011 – Product and Technology Highlights

During the quarter, the Company made solid progress with important new-product introductions and significant design wins in its key growth areas, including energy management & savings, trust & data security, healthcare & wellness and smart consumer devices.

ACCI (Automotive, Consumer, Computer and Communications Infrastructure)

Automotive

• Awarded the new Engine Management system by a European Tier1 and the Engine Management system and transmission by a major Japanese manufacturer.
• Announced that VIPower devices have been chosen for the backbone of both the rear body modules and the front body modules with a German carmaker.
• Achieved a major design win for a class D digital power amplifier with a major European Tier1 for a next-generation Infotainment system.
• Continued its partnership with Sirius XM Satellite Radio in the design of the next-generation chipset, supporting Sirius' aggressive roadmap on integration, performance enhancement and additional features.

Computer and Communications Infrastructure

• Launched the world's first single-chip data encryption engine that meets the highest non-military standards, to protect confidentiality and secure data stored in PCs and laptops.
• Awarded the next-generation power-management unit from a leading hard-disk drive manufacturer addressing both the hard-disk and solid-state drive market segments.
• Earned a 32nm ASIC design win and began providing samples of another ASIC, the first in 32nm process technology, to a leading networking OEM.

Home Entertainment and Displays

• Ramped-up production at major cable operators and awarded new set-top box IC design wins in India.
• Awarded major design wins for the Orly SoC, ST's latest-generation set-top box IC, with leading Korean and Japanese manufacturers. 
• Introduced and demonstrated the Athena SoC for next-generation 4K2K displays; now actively engaging with key panel makers.

Analog, MEMS and Microcontrollers (AMM)

• Gained a significant design win for the iNEMO® inertial module, which was selected by a Korean market leader for a new smartphone model.
• Won a major digital gyroscope and ultra-compact high-performance e-compass design for an Android Platform with a US manufacturer.
• Achieved a significant design win for a digital MEMS microphone with a major Taiwanese PC manufacturer for one of its 2012 models.
• The Stanford University Solar Car team disclosed its selection of the STM32 family of microcontrollers to power numerous functions in its clean-energy solar car.
• Collaborated with FIME to introduce the first Calypso electronic transportation-card compliant with global payment standards and revealed the industry's most secure Trusted Platform Modules for enhanced protection against computer software attacks, theft and tampering.
• STM32 was selected for tablet accessory applications by a world leader in smart phones and tablets and for motor-control platforms and high-volume appliances at major European customers.
• Achieved two major 90nm Contactless Secure MCU design wins for a large transport project in Asia and for a health-card project in Europe.
• Gained two major design wins in the US for controllers in a switched-mode power supply for an all-in-one computer with a major US consumer application OEM and for a Power-Over-Ethernet controller with a networking market leader for a wireless access-point system.
• Expanded business in highly integrated power-supply ICs in AMOLED display matrices with a Korean market leader in new tablet platforms.

Power Discrete Products (PDP)

• MDmesh power MOSFETs continued to gain traction with multiple design wins globally in lighting, switched-mode power supplies and TV applications.
• Achieved a major design win for SLLIMM™ intelligent power modules from a European white-goods maker.
• Secured an important design win for an application-specific discrete device dedicated to electrostatic-discharge protection of high-speed interfaces with a major US consumer application OEM.

ST-Ericsson

• Products
  • The ST-Ericsson Thor™ M7400 modem was selected as a Consumer Electronics Show Innovations 2012 Design and Engineering Awards honoree in the Embedded Technologies product category.
• Customers
  • Sharp announced three new smartphones in Japan that are based on the ST-Ericsson Thor™ HSPA+ 21 Mbps thin modem.
  • Nokia has selected the ST-Ericsson NovaThor™ platform for future devices it plans to introduce based on the Windows Phone mobile platform.
  • The Motorola Atrix 2, launched in October, uses the ST-Ericsson Thor HSPA+ 21 Mbps thin modem.
• Partners/technology
  • ST-Ericsson, in conjunction with STMicroelectronics, announced their involvement in the European VENTURI Project, a group of companies that will work together to develop mobile device platforms and applications that deliver fully-immersive mobile Augmented Reality experiences.
  • ST-Ericsson and CEA-Leti, working with STMicroelectronics and Cadence Design Systems, have developed WIOMING, a three layer stack of multi-core system on chip (SoC) devices connected by the same network on chip (NoC). A proof of concept for a 3D multiprocessor architecture, the WIOMING 3D stack uses Wide I/Os to connect the SoC devices and a DRAM memory chip.