The global semiconductor industry is projected to reach $975 billion in annual sales by 2026, with potential to hit $2 trillion by 2036, driven by AI infrastructure growth. Shares of STMicroelectronics (STM) have surged 43% in the last year, with a recent partnership with Amazon Web Services (AWS) boosting potential.

STMicroelectronics, a global semiconductor company, reported $11.8 billion in revenue for fiscal 2025, with 33.9% gross margin and $265 million in free cash flow. Despite revenue degrowth, STM stock has risen 28% in the past six months, supported by strategic partnerships and positive long-term outlook.

STM stock has seen growth despite revenue declines, fueled by key partnerships. The company anticipates revenue growth from strategic collaborations, such as supplying chips to AWS and SpaceX. Revenue from silicon carbide power devices is expected to rebound, targeting $1 billion in data center revenue by the end of the decade.

European Investment Bank (EIB) signed a €500 million financing agreement with STMicroelectronics to boost Europe’s semiconductor competitiveness. Analysts rate STM stock a consensus “Moderate Buy,” with a mean price target of $33.25. Forward P/E ratio of 31 times, coupled with estimated earnings growth of 100% and 68% for fiscal 2026 and 2027, suggests potential upside for shares.

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