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Memory helps Infineon post turnaround results

Posted: 02 May 2006 ?? ?Print Version ?Bookmark and Share

Keywords:Peter Clarke? Infineon Technologies? financial results?

Infineon Technologies AG was able to post a pre-tax profit, after four quarters of pre-tax losses, in its second fiscal quarter 2006 financial results, just in time to wish its memory spin-off Qimonda "bon voyage" when it started operations yesterday (May 1).

Second quarter revenues increased strongly to about $2.47 billion, up 19 percent sequentially, reflecting higher sales in the memory products and the automotive, industrial and multimarket segments. The company made a net loss of about $32 million in its second fiscal quarter compared to a net loss of about $225 million in the prior quarter.

Infineon's total revenues for the first half of the 2006 financial year were about $4.55 billion, up 7 percent from about $4.24 billion in the same period last year. However, revenues in the communication solutions segment decreased moderately compared to the prior quarter.

Although still in loss, the Q2 results made a marked contrast with the major losses suffered in the previous quarter's results announced January 24.

"Last quarter, we improved our performance significantly. After four quarters of EBIT losses, we are now EBIT positive again," said Wolfgang Ziebart, CEO and president of Infineon, in a statement.

Infineon's memory business, which is due to become Qimonda AG, did well in the second fiscal quarter due to strong growth in bit-shipments and a slight increase in average selling prices. The latter was driven mainly by higher pricing and shipments of DDR2 memories and a higher share of specialty products, the company said.

In Q3 of 2006 financial year, Infineon expects memory bit production to rise by approximately 10 percent and for Qimonda to benefit from the loss of certain corporate overhead expenses. The company said that it expects revenues and earnings before tax in its logic business units to decline in the third quarter.

- Peter Clarke
EE Times

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