STMicro Denies Insider Trading, Faces Lawsuit & Slowdown

Post by: Layla Badr

Photo: Reuters

STMicroelectronics, a well-known European chip-making company, is in the news after being accused of insider trading. The company’s supervisory board spoke out on Thursday, denying that any illegal actions were taken by two top members of its management team.

The situation began when Italy’s economy minister, Giancarlo Giorgetti, said that STMicro's management sold some of their company shares just one day before sharing poor financial results. He questioned the timing and called it suspicious.

However, STMicro explained that these share sales were not done by the managers themselves. Instead, the sales were handled by an outside group that runs the company’s stock plans. According to STMicro, the shares were sold automatically as part of a pre-set process, which even happened during a time when employees are usually not allowed to trade shares (known as a “blackout period”).

Stay informed with the latest news. Follow DXB News Network on WhatsApp Channel  

Giorgetti also said that the Italian government is not happy with STMicro’s CEO, Jean-Marc Chery. Italy and France together own 27.5% of the company through a shared holding group, which gives them a say in how the company is run.

On top of this, STMicro is also dealing with a class action lawsuit in the United States. The lawsuit claims that the company misled investors by hiding information about problems with its business. But the company’s supervisory board says it has a “good defense” and believes it can fight the lawsuit.

STMicro and other chipmakers in Europe are having a tough time right now, especially in the car and industrial markets where they usually do well.

Earlier in 2024, during its second-quarter earnings report, STMicro made a big cut to its yearly forecast. This caused the company’s stock price to drop a lot. Then, in October, they lowered their forecast again for the third time that year. In January, they also delayed the announcement of their 2025 financial goals and haven’t said when they will share them.

So far, the company is trying to manage both investor concerns and government pressure while dealing with a slowdown in its key markets.

#trending #latest #STMicro #InsiderTrading #Chipmakers #TechNews #StockMarket #MarketUpdate #Semiconductors #Lawsuit #2025Outlook #BusinessNews #EuropeTech #InvestorAlert #headlines #topstories #globalUpdate #dxbnewsnetwork #dxbnews #dxbdnn #dxbnewsnetworkdnn #bestnewschanneldubai #bestnewschannelUAE #bestnewschannelabudhabi #bestnewschannelajman #bestnewschannelofdubai #popularnewschanneldubai