ALLENTOWN, Pa. -- Agere Systems Inc. today posted a net loss of $1.1 billion for its fiscal third quarter, ended June 29, including a larger-than-expected inventory write-down of $270 million and $440 million for restructuring charges associated with layoffs and plant closings announced last month.
Agere (formerly Lucent Microelectronics) said its revenues in the quarter were slightly above revised estimates at $927 million, which is a 23% sequential drop from $1.2 billion in the prior three-month period. Excluding the inventory write-down, charges and assuming full tax benefits, Agere said its pro forma net loss in the just-ended quarter would have been $115 million, or $0.07 per share.
The company is attempting to navigate its way through the chip industry's worst recession by making significant cutbacks in its operations while attempting to continue key investments in optoelectronics and ICs for the eventual upturn, said John Dickson, president and CEO of Agere. In late June, Agere announced it was laying off an additional 4,000 workers and closing down a wafer fab in Madrid, Spain, as part of a major restructuring of its manufacturing operations.
Dickson said the consolidation and layoffs announced in June, "combined with other cost-cutting measures across the business, will enable us to lower our breakeven point."
Agere said it has now identified a buyer for the Madrid plant--U.K.-based BP plc, a supplier of energy products and services. A sales agreement is expected to be announced soon for the facility. Details about how BP would use the wafer fab plant were not released today.
The Allentown-based semiconductor company said integrated circuit revenues sequentially dropped 20% to $650 million in the just-ended quarter from $812 million in the prior quarter. Revenues from optoelectronics dropped 27% in the quarter to $277 million from $379 in the prior period, said Agere.
Agere is now forecasting a 30-to-35% sequential decline in revenues in the current quarter from the fiscal third quarter. The company also said it expects a pro forma net loss per share, deferring recognition of tax benefits on losses, in the range of $0.30 to $0.33 per share for the fiscal fourth quarter.