Gross profit totaled $2.12 billion, representing a year-over-year increase of 16.5%. Gross margin of 49.0% increased 160 basis points year-over-year, mainly due to product mix, favorable pricing, positive currency effects, net of hedging, partially offset by higher manufacturing costs.

Operating income increased 14.2% to $1.15 billion, compared to $1.00 billion in the year-ago quarter. In the second quarter 2023, net operating expenses included negative non-recurring non-cash items amounting to $34 million. The Company’s operating margin increased 30 basis points on a year-over-year basis to 26.5% of net revenues, compared to 26.2% in the 2022 second quarter.

By product group, compared with the year-ago quarter:

Automotive and Discrete Group (ADG):

• Revenue increased for both Automotive and Power Discrete.
• Operating profit increased by 73.8% to $624 million. Operating margin was 31.9% compared to 24.7%.

Analog, MEMS and Sensors Group (AMS):

• Revenue decreased in Analog, in Imaging and in MEMS.
• Operating profit decreased by 48.3% to $139 million. Operating margin was 14.8% compared to 24.1%.

Microcontrollers and Digital ICs Group (MDG):

• Revenue increased for both Microcontrollers and RF Communications.
• Operating profit increased by 19.0% to $505 million. Operating margin was 35.4% compared to 33.6%.

Net income and diluted earnings per share increased to $1.00 billion and $1.06 respectively, compared to $0.87 billion and $0.92 respectively, in the year-ago quarter.

Cash Flow and Balance Sheet Highlights

				Trailing 12 Months
(US$ m)	Q 2 202 3	Q 1 20 2 3	Q 2 20 2 2	Q 2 202 3	Q 2 20 2 2	TTM Change
Net cash from operating activities	1,311	1,320	1,056	5,832	3,777	54.4%
Free cash flow (non-U.S. GAAP)1	209	206	230	1,694	1,046	62.0%

Net cash from operating activities was $1.31 billion in the second quarter compared to $1.06 billion in the year-ago quarter.