SCIENCE

GENEVA, SWITZERLAND -- STMicroelectronics (NYSE: STM) reported results for the second quarter and first half ended June 30, 2001. Net revenues for the second quarter were $1,587.2 million, in line with the Company's guidance range of $1.55 billion to $1.6 billion contained in its news release dated June 14, 2001. In last year's second quarter the Company reported net revenues of $1,877.3 million. The Company experienced a significant amount of end-of-period order push-outs and cancellations, reflecting accelerated weakness in certain of its end markets, particularly telecom and computer peripherals. As a result, the Company has incurred a second quarter excess inventory pre-tax charge of $70.7 million. Excluding the effect of this special charge, gross margin for the second quarter of 2001 was 38.0%, as previously anticipated. Including the effect of the charge, gross margin for the period was 33.6%. At the end of the second quarter, ST took further actions to better align existing resources with changing market conditions. Consequently, the Company recorded a second quarter impairment and restructuring pre-tax charge of $311.3 million, primarily comprised of asset impairment charges relating to certain of its 6" wafer fabs and to goodwill. This includes the previously announced charge relating to the closure of its Ottawa manufacturing facilities, which amounted to $40.3 million.