×

UPDATE 1-STMicro is confident it will achieve second-half targets

* Shares rise

* Confident about meeting financial targets (Adds analyst comment, share reaction, details)

PARIS, July 26 (Reuters) - STMicroelectronics expressed confidence on Wednesday on achieving its targets in the second-half of the year, after it reported better-than-expected quarterly results.

Europe's second-biggest chipmaker is benefiting from growing demand for sensors for smartphones, cars, and devices related to the burgeoning so-called "Internet of Things" (IoT) sector of internet-connected machinery and household devices able to collect and exchange data using embedded sensors.

Second-quarter net revenues rose 5.6 percent from the previous quarter to $1.92 billion, reflecting a gross margin of 38.3 percent - above the company's guidance.

The group is "well-positioned" to achieve its second-half financial targets, said Chief Executive Officer Carlo Bozotti. These include a full-year revenue increase between 12.5 and 15.5 percent to around $8 billion, and 10 percent operating margin in the second-half.

Bozotti also expected third-quarter revenues to grow by about 9 percent from the previous quarter, plus or minus 3.5 percentage points.

"STMicro's revenue growth is broad based and we expect it to continue not only into the fourth quarter, but also in 2018," analysts at brokerage Liberum said in a note to clients.

"The company is very well positioned in the fast-growing IoT segment, while its automotive business is also finally heading towards strong growth," it added.

The chipmaker's stock was up around 2 percent in early session trading, valuing the company at 13 billion euros ($15.1 billion). STMicro shares have risen roughly 35 percent since the start of 2017.

The Franco-Italian company had announced in January a deal with an unnamed customer that can generate "substantial revenues" in the second half of the year, which analysts believe are tied to parts for upcoming Apple iPhones.

Apple is among the chipmaker's major clients, but the company does not provide details on the nature of components it manufactures for the phone-maker.

In April, STMicro extended Bozotti's contract as CEO by a year and lined up its operations chief, Jean-Marc Chery, to succeed him.

($1 = 0.8592 euros) (Reporting by Mathieu Rosemain; Editing by Sudip Kar-Gupta)