ST: Tesla Supplier STMicroelectronics Backs CEO After Italy Criticizes Management Amid Board Feud - Update

By Mauro Orru and Ian Walker STMicroelectronics said it was fully behind its chief executive after an Italian government minister criticized management amid a board nomination feud. The European chip maker said it supported Chief Executive Jean-Marc Chery and Chief Financial Officer Lorenzo Grandi in their efforts to revive the company's fortunes as much of the semiconductor industry grapples with sluggish demand for legacy chips. The announcement comes after Italian Economy and Finance Minister Giancarlo Giorgetti said in a press conference that Rome was withdrawing its support for Chery after the company rejected Italy's nomination of Marcello Sala, head of a department at the ministry, to STMicroelectronics' supervisory board. Giorgetti said the rejection was "incomprehensible, very serious and unacceptable." The nomination came weeks after STMicroelectronics said Maurizio Tamagnini, vice chairman of the company's supervisory board and former chair, was stepping down from his role. "The behavior of the Italian shareholder will from now on be one of critical opposition," Giorgetti said. STMicroelectronics didn't respond to a request for additional comment on the board feud. Formed in 1987 from the combination of the semiconductor business of Italy's SGS Microelettronica and the non-military business of France's Thomson Semiconducteurs, STMicroelectronics has become a fixture of Europe's semiconductor scene. The company, in which Italy and France hold a combined stake of nearly 28%, counts Apple, Samsung Electronics and Tesla among its customers. The company has been navigating uneven demand in recent quarters. While appetite for chips to power the data centers behind the artificial-intelligence boom continues to thrive, demand for legacy semiconductors found in cars, industrial equipment and other devices has been subdued in recent months. STMicroelectronics downgraded its guidance several times last year and said in January that it was forecasting revenue of about $2.51 billion for the first quarter, down nearly 28% on year. The projection came in below analysts' expectations, sending shares down on Jan. 30 when the company reported 2024 earnings. Giorgetti said during Wednesday's press conference that members of STMicroelectronics' management team had sold their shares in the company on the eve of the latest earnings release. STMicroelectronics said the accusations were false, adding that stock sales had been done during the company's blackout period by a stock plan administrator in compliance with Swiss tax rules. STMicroelectronics' headquarters is located in Geneva, Switzerland. Write to Mauro Orru at mauro.orru@wsj.com and Ian Walker at ian.walker@wsj.com (END) Dow Jones Newswires April 10, 2025 07:19 ET (11:19 GMT)