Electronics giant Philips said today its Semiconductors division will post an operating loss of around euro 175 million in the second quarter.
The company attributed the loss to, "lower revenues, reducing inventories and increasing price erosion in a mostly fixed cost business."
The division had operating profit of euro 231 million in the first quarter on sales of euro 1.42 billion.Sales in the three months to June 30th are expected to fall 20-25 per cent from the first quarter, while fab utilization will drop to around 40-45 per cent by the end of this month, the company said.
It will take a one-time pretax charge of euro 90 million in the quarter for transferring a US production line from a site in Albuquerque to Fishkill.
The company noted that the charge comes on top of a previously announced 350 million charge in the quarter for restructuring at the consumer electronics and components division.
Philips will report second-quarter results on July 17th.
AFP