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German-based, Infineon Technologies AG, Europe's second biggest semiconductor maker, posted first quarter revenues of EUR1.03 billion on Monday, down five percent sequentially and 28 percent year-on-year. The company reported a net loss of EUR331 million for the three months to December, which improved sequentially from a net loss of EUR523 million, but down from net income of EUR280 million year-on-year.
The company said revenues decreased primarily as a result of a continued difficult market environment for the semiconductor industry, in particular for wireline communications and chip card ICs. However, the quarter also saw some positive signs in demand for mobile communication products with the Wireless Solutions unit posting a 15 percent increase in revenue to EUR206 million. The Memory Products group within Infineon also showed signs of recovery, increasing 18 percent sequentially to EUR285 million.
The world's fourth-largest producer of computer memory chips said it had been hit particularly hard as prices for dynamic random access memory (DRAM) chips have sunk well below the cost of producing them.
EBIT (earnings before interest and taxes) amounted to a loss of EUR564 million. Net loss amounted to EUR331 million, a sequential improvement from a loss of EUR523 million in the previous quarter but down from net income of EUR280 million year-on-year. Loss per share for the first quarter was EUR0.48 compared with a loss per share of EUR0.76 in the previous quarter and with earnings per share of EUR0.45 in the first quarter of the last fiscal year.
"Infineon's revenue performance was driven by continued strong demand in memory products as well as a moderate recovery of demand in mobile communication," said Dr. Ulrich Schumacher, president and chief executive officer of Infineon Technologies AG. Revenues outside Europe constituted 49 percent of total revenues in quarter.
The company says the market outlook in the next six months still remains uncertain and although there are some early positive signs of increasing demand in certain segments, there is as yet no clear signals for a sustainable overall market recovery.
Last year the Infineon announced plans to cut its global workforce by 5,000 and as of 31 December 2001 it employed approximately 30,700 worldwide. The company employs 10 at its Dublin base. In December the business abandoned talks with Toshiba on potential cooperation in the memory segment.
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