Wednesday, 23 July 2008

NXP Announces Loss in Q2

NXP Semiconductors announced second quarter sales of USD 1,524 million, a comparable decrease of 1.9% on the second quarter of 2007 and a comparable decrease of 0.6% over the first quarter of 2008, reflecting the continuing softness of the overall market.

According to The Netherlands based NXP, although costs were significantly reduced this quarter leading to improved gross margins, the strong negative impact of the weaker dollar, which had an EBIT impact of approximately USD 70 million, offset these gains and led to a decreased EBITA.

“The continued focus on our Business Renewal strategy resulted in improved gross margins, however savings have been eroded by the continuing weakness of the dollar. A core priority for the remainder of the year is to take additional decisive steps to mitigate our currency exposure and re-align our business to better suit our reduced size following the creation of ST-NXP Wireless,” said Frans van Houten, President and CEO of NXP Semiconductors.

In terms of outlook for the next quarter, NXP expects the overall market sentiment to continue to see a relatively flat market. The company expects a year-over-year comparable mid single digit sales decrease, translating into similar sales levels as in the second quarter.