Infineon slides in fiscal first quarter
- — 22 January, 2002 08:30
Semiconductor maker Infineon Technologies AG is blaming poor market conditions, especially in the wireline communication and chip-card sectors, for the steep plunge it took during its fiscal first quarter. The company made a net loss of 331 million ($A546 million as of Dec. 31, the last day of the period being reported), compared to net income of 280 million posted during the same quarter a year ago, Infineon said in a statement Monday.
Revenue for the period, at 1.03 billion, marked a decline of 38 percent from the 1.66 billion in the first quarter of fiscal 2001. Per-share losses came to 0.48, compared to earnings per share of 0.45 for the year-ago quarter.
The company noted some bright spots in its business -- including "positive signs" in demand for mobile communication chips and a moderate price rise in memory products -- but did not predict a quick recovery.
"We should really have seen our revenue bottom out," said Executive Vice President and Chief Operating Officer Andreas von Zitzewitz during a conference call discussing the results. "We think that in the next quarter we should be able to increase revenue again. In wireless, we also see a modest recovery. It's very difficult to argue whether it's the market in general, or just Infineon, because we have some customers with very strong growth potential. .... We would expect that our wireless revenue continues to increase moderately."
The Memory Products group posted revenue for the quarter of 285 million, down 43 percent from the 497 million figure from the fiscal first quarter of 2001. Executives said there was strong demand during the most recent quarter, but that the price war in the DRAM (Dynamic Random Access Memory) industry had taken its toll.
DRAM prices increased in the quarter to an average of about US$2.20 per unit, over about $2.10 in the previous quarter, said von Zitzewitz.
The company's Wireless Solutions group saw first-quarter revenue of 206 million, down 41 percent from the 350 million posted in the same period last year. A modest boost was provided by a slight jump in demand for mobile handsets and by increasing sales of Bluetooth chipsets, the company said.
Infineon's Security and Chip Card ICs group reported quarterly revenue of 82 million, a decline of 47 percent from the year-ago figure of 154 million. The company attributed the drop mostly to lower sales of security controllers used in SIM (Subscriber Identity Module) cards for mobile phones, and to customers' ongoing inventory reductions.
Infineon's poor performance caused its former parent company, Siemens AG, to reduce its stake in the semiconductor maker to less than 50 percent, enabling Siemens to exclude Infineon's figures from its financial reports.