MADISON, Wis. — The comeback of STMicroelectronics (Geneva) has been widely reported in recent months. Testimony to the company’s revival lies in an upbeat set of recent financials and product portfolios. ST's first nine months revenue this year grew to $5,880 million from $5,113 million in the same period a year ago.
Ams (Premstaetten, Austria), a vendor of analog, mixed signal and sensor products, is also doing well. In fact, the company, although much smaller than ST in size, is closer to spectacular. In the first nine months this year, Ams’ revenue jumped by 42.5 percent to 593 million euros compared to the same period of 2016. Ams CEO insists this is not just a short-term spike. He is forecasting a compound annual revenue growth rate of “more than 40 percent” through 2019.
Ams latest financial results (Source: Ams)
In iPhone X, Apple adopted leading-edge NIR imagers from STMicroelectronics, while deploying dot illuminators from Ams. Undoubtedly, both companies are profiting from these big design wins. More to the point, to frame the success of these two European companies as just a lucky break induced by the iPhone X factor would be an understatement.
Consider three big changes quietly brewing in Europe.
First, European microelectronics companies are finding their voice again. They have brought much-needed focus to their business with a big emphasis on such growth areas as “sensing” and “automotive.” That’s a big part of it.
Second, European chip vendors are applying a much finer level of analysis to strategy. Neither ST nor Ams is focusing broadly on the general sensor market. Each has identified “3D sensing” as the biggest growth segment of the sensor market, for which they are boldly taking on the complex technology challenges.
Third, Europe has never given up its passion for technology development. Neither ST nor Ams has totally abandoned manufacturing. Their in-house manufacturing capabilities are paying off now.
In his recent report, Pierre Cambou, imaging activity leader at Yole Développement, made the strongest case for ST.
Looking back, he said ST’s imaging division should have disappeared when Nokia lost its way [in the then newly emerging smartphone battle, and sold its handset business to Microsoft.] But it did not. He asked why.
Cambou credits the engineering teams’ resilience and creativity at ST. In his opinion, “the craziness of investing in Single Photon Avalanche Diode (SPAD) technology became the first step in maintaining life support to [ST’s] endangered [imaging] business.” He said, “Passion for science and technology is not always logical, nor overly business-efficient, but it creates a positive environment for trying new things and going beyond traditional barriers, where no competitor even exists.”
Cambou added, “STMicroelectronics has shown that innovation is not just a game for startups; large companies can also make the right moves.”
3D Sensing: ‘Mega trend’
The story of Ams is much different. In a recent one-on-one interview with EE Times, Ams CEO Alexander Everke discussed his company’s aggressive, but tightly targeted strategy, which has led to Ams’ successful entry into high-end segments of a certain sensor market such as light sensing.
Alexander Everke, CEO at Ams (photo: Ams)
Unlike valuation-driven M&A activities in recent years, particularly prevalent among Silicon Valley-based chip companies, Everke stressed, “Ams is focused on acquiring technologies, not the revenue.”
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