SAN JOSE – Mobile chip designer ST-Ericsson grew revenues but failed to shave net losses in its most recent financial quarter. The troubled company--just three months into a makeover--predicted flat sales for the coming quarter due to global economic and industry conditions.
Revenues jumped 19 percent to $344 million from $290 million in the previous quarter, but still down from $385 million in the same period last year. Net losses increased slightly to $318 million from $312 million in the previous three months and $221 million in the same quarter last year.
In a press statement, ST-Ericsson focused on improvements in operating losses which decreased sequentially by $62 million to $235 million. It said the gains were the result of volume and margin improvements and cost cutting moves.
The company attributed the revenue growth to design wins in several handsets including Samsung’s Galaxy Beam and Ace 2, Sony’s Xperia go and the Bambook from China’s Shanda. In addition, China Unicom and YuLong will use the company’s NovaThor chips and Panasonic rolled out two Eluga handsets for the Japan market using ST-E modems.
Late last year, Didier Lamouche, chief operating officer of parent company STMicroelectronics, was named chief executive of ST-Ericsson in a shake up at the loss-making mobile chip venture with Ericsson. Lamouche announced in April plans to cut 1,700 jobs or about 25 percent of the ST-Ericsson work force and transfer the application processors development team to STM, a task completed on July 1.
Observers said they were underwhelmed by Lamouche’s plans and called for the company or parts of it to be sold off, ideally to a China-based chip maker.