(Updates share price move)

By Mathieu Rosemain

PARIS (Reuters) -Franco-Italian chipmaker STMicroelectronics said it is hoping for over $20 billion in annual sales by 2027 at the latest, sending its shares higher as investors welcomed the prospect of prolonged growth underpinned by the digitalisation of the economy.

STMicro’s mid-term sales target represents about a 30% increase from the top range of its expectations for this year, at $15.3 billion.

The semi-conductor industry is running at full steam to the point that it recently hit bottlenecks that affected the output of major carmakers.

STMicro said that it was ramping up its production to meet soaring demand for chips and sensors that can now be found in increased number in smartphones, cars and a growing number of connected devices.

The electrification of the car industry, new mobile networks and a boom in cloud services are beefing up orders for the group’s chips, it said.

Chief Executive Officer Jean-Marc Chery said he expected sales of silicon carbide chips, aimed at improving the charging capacity of batteries in electric vehicles and the time between charges, to reach $1 billion in 2023, one year earlier than previously expected.

STMicro’s shares were up by about 2% at 1000 GMT, topping France’s blue-chip index CAC 40.

The stock is down by 22% so far this year, as the COVID-19 pandemic and the war in Ukraine fuelled market concerns about a sustained disruptions for the industry and an inflation of commodity and energy prices.

STMicro also hopes to to generate an operating margin of over 30% by 2027 at the latest.

The new guidance covers the 2025 to 2027 period, which means STMicro estimates it could reach the new sales and profit targets earlier, depending on market conditions.

The Geneva-based company, whose biggest clients include iPhone maker Apple and electric carmaker Tesla, set the new financial forecast just before the start of its capital markets day held in Paris.

(Reporting by Mathieu RosemainEditing by GV De Clercq and Kim Coghill)