PARIS European chipmaker STMicroelectronics NV (Geneva, Switzerland) reported that its second half net loss was $860 million, or $-0.98 per share, compared to a net loss of $131 million, or $-0.15 per share in the first half of 2008.
For the second quarter, ST said its net loss was $318 million, or $0.36 per share, compared to a net loss of $47 million, or $0.05 per share, in the year ago quarter.
The semiconductor company published net revenues of $1,993 million in the second quarter of 2009, up 20 percent sequentially. Five analysts had consensus revenue estimate of $1.84 billion for the quarter.
This performance is, however, offset by the 25-percent sales drop for the first half of 2009, ended June 27, 2009, on a yearly basis, due to weak industry conditions that more than offset the net impact of M&A transactions.
For the first half of 2009, ST said its gross margin was 26.2 percent of net revenues. This compares to a gross margin of 36.5 percent in the first half of 2008, reflecting significantly lower volumes and operating inefficiencies due to weak industry conditions.
"It is clear that the global recession has negatively impacted our financial results in the first half of 2009, but it has not slowed our efforts to develop leading-edge products," commented Carlo Bozotti, president and CEO of ST.
Bozotti highlighted the "stronger-than-expected performance" across most market segments including computer, automotive, telecom and industrial. He also mentioned the introduction of many next-generation products in the second quarter, including analog controllers and power MOSFETs for power management in computer motherboards, high-voltage MDMesh power MOSFETs for switched-mode power supplies, MEMS gyroscopes, and advanced GPS solutions.
Looking ahead, ST said it predicts third quarter revenues to be between $2.07 billion and $2.27 billion, up between 4 and 14 percent on a sequential basis.
Similarly, ST said it expects its gross margin to increase sequentially to 31 percent, due to "partially recovered operating efficiencies, an increase in fab utilization to about 75 percent, still leading to some further reduction in inventory, and an improved product mix."
Bozotti commented: "As we enter the third quarter, we are encouraged as our backlog, including frame orders, is higher than it was when we entered the second quarter of 2009. Based on current booking activity and visibility, we expect to register solid sequential revenue growth in all market segments and geographies."
He continued: "Finally, we are driving down the Company's break-even point through the previously announced one billion dollar savings and productivity plan. This broad-reaching plan encompasses manufacturing, the rationalization of sites, and capturing synergies in wireless. We are in-line with our plan to lower costs by $750 million in 2009 and expect a majority of those savings to be realized in the second half of 2009."
Last week, ST-Ericsson, the joint venture of STMicroelectronics and Ericsson, raised its revenues from $562 million (about 400 million euros) in the first quarter to $666 million in the second quarter. This represents a 18.5-percent increase.
ST-Ericsson also reported a $165 million operating loss in the second quarter.