HP 3Q profit drops 19 percent as sales of PCs and printer ink remain weak

• By Jordan Robertson, AP Technology Writer
• On Tuesday August 18, 2009, 9:13 pm EDT

SAN FRANCISCO (AP) -- Hewlett-Packard Co.'s profit dropped 19 percent in the latest quarter, dragged down by ongoing weakness in sales of personal computers and printer ink.

The Palo Alto, Calif.-based company reported Tuesday that consumer spending on PCs is improving, and business in China was particularly good. Corporations are still being tightfisted, though.

Because of the recession, 2009 is shaping up to be the worst year in nearly a decade for the PC industry. HP, the world's No. 1 PC maker, has been branching out into other areas, like technology services and computer networking, but the PC business still makes up nearly a third of its revenue.

Sales in HP's PC business eroded 18 percent in the three months ended July 31, even as the number of units sold ticked up 2 percent. The discrepancy is explained by the fact PC makers have been slashing prices, a trend that has also hurt rivals. For instance, Wall Street projects a 23 percent sales drop at Dell Inc., the No. 2 PC maker, which will reports its latest quarterly numbers Aug. 27.

HP edged past Wall Street's profit and sales forecasts, and issued better-than-expected profit guidance. But expectations had been high, with HP's stock climbing about 75 percent since March.

Shares fell 96 cents, or 2.2 percent, to $43 in extended trading following the results. The stock had closed earlier Tuesday up 85 cents, or 2 percent, at $43.96.

HP reported after the market closed that it earned $1.64 billion, or 67 cents per share, in the fiscal third quarter. A year earlier the company made $2.03 billion, or 80 cents per share.

Excluding one-time items, HP earned 91 cents per share, a penny better than the average estimate of analysts polled by Thomson Reuters.

Sales fell 2 percent to $27.45 billion, slightly ahead of analysts' projections for $27.26 billion. Sales would have risen 4 percent were it not for currency fluctuations.

Revenue from printing supplies was down 13 percent. One of those supplies -- printer ink -- has long been one of HP's biggest moneymakers, but has been facing competition from generic, cheaper brands.

HP has been reluctant to call a bottom in the PC market, as chip maker Intel Corp. did in April -- one of the first bullish signs about a turnaround in that sector. Cathie Lesjak, HP's chief financial officer, said in an interview Tuesday that PC demand appears to have "stabilized."

Lesjak said the decline in printing supplies revenue was mostly caused by currency fluctuations and changes in the way HP manages inventory at resellers. She said she expects the supplies business to improve over the next couple of quarters.

Analyst Rob Cihra with Caris & Company said despite management's explanations of inventory adjustments, trends in HP's core printing business "looked pretty underwhelming once again."

HP is encroaching more onto rival IBM Corp.'s turf since last year's $13.9 billion acquisition of Electronic Data Systems, a technology services company. IBM went through an aggressive transformation of its own over the past decade, shedding its PC and hard drive businesses as it tried to focus more on services and software.

Services are now HP's biggest revenue and profit generators. The combined HP-EDS had $8.47 billion in services revenue in the latest quarter. It's hard to compare that to last year, though, because the numbers HP has released don't compare directly year-to-year. HP says that's because EDS wasn't a part of HP at this time last year, and the companies are still being integrated.

Aggressive cost-cutting has been a major help to HP's finances and has been a hallmark of CEO Mark Hurd's 4 1/2 years at the company.

HP is cutting 24,600 jobs as part of the EDS acquisition and in May announced a separate round of 6,400 cuts involving workers from the product divisions. HP had about 320,000 workers before the layoff plans were announced.

Looking ahead, the company's fiscal fourth-quarter profit outlook of $1.12 per share, excluding one-time items, is better than the $1.07 per share that analysts were expecting. Its forecast for revenue to rise about 8 percent quarter-over-quarter is in line with analyst estimates.

HP also reaffirmed its full-year 2009 revenue outlook.

The numbers were good and "the guidance is a relief. Their commentary though is what I would focus on: conditions are stabilizing, and some of the cyclical businesses should show a rebound next year," said Jayson Noland, an analyst with Robert W. Baird & Co.

Still, there were "no big surprises, ho hum," he added. "I don't expect the stock to do much one way or the other. (The stock) has been very strong."

Analog Devices Announces Financial Results for the Third Quarter of Fiscal Year 2009

• Press Release
• Source: Analog Devices, Inc.

NORWOOD, Mass.--(BUSINESS WIRE)--Analog Devices, Inc. (NYSE: ADI - News)

• Revenue was $492 million
• Diluted EPS from continuing operations was $0.22
• Cash and short-term investments, net of debt, at the end of 3Q09 totaled $1.3 billion
• Board of Directors declared a cash dividend of $0.20 per share
• Financial results will be discussed via conference call today at 5:00 pm

Analog Devices, Inc. (NYSE: ADI - News), a global leader in high-performance semiconductors for signal processing applications, today announced financial results for the third quarter of fiscal 2009, which ended August 1, 2009.

Results of Operations for the Third Quarter of Fiscal 2009

• Revenue was $492 million, an increase of 4% from the immediately prior quarter and a decrease of 25% from the same period one year ago. For more information regarding the breakout of revenue by end market and product type for the third quarter of fiscal 2009, please see Schedules D and E of this document. In addition, a more complete table covering prior periods is available on the Analog Devices Investor Relations web site at: investor.analog.com.
• Gross margin was 54.1% of revenue, compared to 55.1% of revenue in the immediately prior quarter, and 61.0% of revenue in the year-ago period. The sequential decrease in gross margin was primarily due to end market revenue mix.
• Operating expenses were $187 million, a decrease of $16 million from the immediately prior quarter which included a $12 million restructuring charge, and a decrease of $53 million, from the same period one year ago.
• Operating income from continuing operations was $79 million, or 16.0% of revenue, compared to $58 million, or 12.2% of revenue, in the immediately prior quarter, and $161 million, or 24.5% of revenue, in the year-ago period.
• Diluted earnings per share (EPS) from continuing operations was $0.22, compared to $0.18 in the immediately prior quarter, and $0.44 in the year-ago period.
• Net cash provided by operating activities was $134 million, or 27% of revenue. Capital expenditures were $5 million, and cash dividends of $58 million were paid during the third quarter of fiscal 2009.
• Cash and short-term investments at the end of the third quarter of fiscal 2009 totaled approximately $1.7 billion, an increase of $439 million from the prior quarter which includes $370 million of net proceeds from an offering of 5.00% five-year notes completed in the third quarter.
• Accounts receivable in the third quarter of fiscal 2009, as measured by days sales outstanding, was 45 days, compared to 44 days at the end of the immediately prior quarter.
• Inventory at the end of the third quarter of fiscal 2009 decreased by approximately $29 million, or 9%, compared to the immediately prior quarter. Days in inventory decreased to 112 days at the end of the third quarter of fiscal 2009 from 130 days at the end of the immediately prior quarter.
• The Board of Directors declared a cash dividend of $0.20 per outstanding share of common stock which will be paid on September 16, 2009 to all shareholders of record at the close of business on August 27, 2009.

“ADI had a solid third quarter, delivering sequential sales growth of 4% with the largest increases in the automotive and consumer end markets. During the quarter, we also saw order rates from industrial customers begin to improve as inventory reductions subsided,” said President and CEO Jerald G. Fishman. “Importantly, we reduced costs for the third consecutive quarter, resulting in a cumulative decline in operating expenses of well over 20% since the end of fiscal 2008. By driving continued competitive advantage through innovation while remaining focused on expense management, we’re positioning ADI to achieve solid revenue growth and operating leverage as demand improves.”

Outlook for the Fourth Quarter of Fiscal 2009

The following statements are based on current expectations. These statements are forward- looking and actual results may differ materially, including as a result of the important factors discussed at the end of this release. These statements supersede all prior statements regarding business outlook set forth in prior ADI news releases.

Regarding the outlook for the fourth quarter of fiscal 2009, Mr. Fishman stated, “There are near-term indications that business conditions are improving. Order rates strengthened throughout the third quarter and have remained strong during the first two weeks of August. Our book-to-bill ratio for the third quarter, as measured by end customer bookings, was above one, and our fourth quarter opening backlog was up from last quarter.”

Mr. Fishman continued, “Given these factors, we expect that our revenue will grow to approximately $510 million to $530 million in the fiscal fourth quarter. While we plan to continue to tightly manage inventory levels, we expect a small increase in utilization, which should result in a gross margin in the fourth quarter of approximately 55.0%. In addition, we plan to continue to closely manage operating expenses and expect them to increase slightly by approximately 1% to 2% in the fourth quarter. As a result, our plan is for diluted EPS from continuing operations to increase again to approximately $0.24 to $0.26 in the fourth quarter.”

Analyst predicts rapid growth for pico projectors

Dylan McGrath
EE Times
(08/06/2009 4:00 PM EDT)

SAN FRANCISCO—Pico projectors embedded into products such as smartphones are set to experience a sixtyfold growth in shipments during the next four years, according to a forecast by market research firm iSuppli Corp.

Shipments of embedded pico projectors will rise to more than 3 million units in 2013, up from less than 50,000 units this year, iSuppli (El Sequndo, Calif.) predicted. The firm defines pico projectors as front projectors weighing less than 2 pounds and sized at less than 60 cubic inches without a battery pack.

The capability of picoprojectors to overcome screen-size limitations in mobile electronics devices, projecting a large image despite their small size, makes embedded pico projectors a perfect fit for space-constrained mobile devices, according to iSuppli.

"Mobile electronic devices offer consumers and corporate users the portability they desire, causing an increasing number of users to employ products like smart phones and netbook PCs as their primary platforms for computing and Internet access," said Sanju Khatri, iSuppli principal analyst for signage/projection, in a statement.

"However, a major obstacle blocking the use of mobile devices in this fashion has been their tiny displays relative to desktop PCs," Khatri said. "Embedded pico projectors promise to enlarge these displays, making mobile devices more capable as primary computing and Internet-access platforms."

Pico projectors are likely to find initial acceptance in the corporate market, allowing businesspeople to make presentations directly from their mobile PCs, smart phones or PDAs, according to iSuppli. But the devices also have a strong allure to consumers, allowing large-sized display of video, Internet sites and applications, according to the firm.

Smartphones represent a promising market for embedded pico projectors, iSuppli said, noting that Samsung Electronics Co. Ltd. unveiled a smartphone with a pico projector, dubbed "The Show," at the Consumer Electronics Show in January. Other smart phones equipped with pico-projectors are likely to be introduced soon, iSuppli said.

The Samsung phone uses Texas Instruments Inc.'s Digital Light Processing (DLP) projection technology. Besides DLP and other MEMS display technologies, liquid crystal on silicon (LCOS) technology shows equally strong promise in the embedded pico projector market, according to iSuppli.

Despite the rapid projected growth for embedded pico projectors, iSuppli said they will still account for only a small fraction of overall mobile device shipments through 2013.

"The growth potential for embedded pico projectors will be limited during the next few years due to challenges in areas including power consumption, size and manufacturing," Khatri said. "As these issues are resolved, pico projectors will appear in many more mobile electronics devices."

Smart phones segment has grown in Q2’09 despite decline in overall mobile handset sales this year. Not much surprise this quarter, apple has done phenomenally well, HTC and RIM has continued to show positive growth.

iPhone market share grew 375% in Q2

Source: Gartner August 2009

Sales of Nokia's (NOK) Symbian smartphones are drifting. Apple's (AAPL) iPhone is gaining on RIM's (RIMM) BlackBerry. Microsoft's (MSFT) Windows Mobile is still sinking. And the launch of the Palm (PALM) Pre barely made a ripple in the gobal smartphone market.

Those were the headlines from the smartphone portion of Gartner's 2009 Q2 mobile phone report, which saw smartphone sales grow 27% even as overall mobile phone sales, feeling recessionary pressure, fell 6%.

In this context, Apple was the clear winner. Its iPhone sales, as Gartner counts them, grew more than 500% year to year, and its market share, as we figure it, grew 375%. (See chart below the fold.)

"Apple's expansion into a larger number of countries in the past year has produced a clear effect on sales volumes, as have the recent price adjustments on the 8GB 3G iPhone," according to Gartner's press release. "Apple brought its much-anticipated new device — the iPhone 3G S — to market at the end of the second quarter of 2009, but its full potential will only start to show in the sales figures in the second half of 2009."

Gartner made note of the declining market shares of Symbian and Windows Mobile, but it expressed particular concern about the Palm Pre.

"This device attracted a lot of media attention but showed mixed results at the cash register as sales only reached 205,000 units," said Gartner principal analyst Roberta Cozza. "Palm currently ranks tenth in the smartphone market and Gartner remains concerned about its ability to gain traction outside the US market, where its brand is less strong."

Not much surprise from last quarter, top 5 maintained their positions worldwide, LG and Samsung continue to outperform the market.

NS

Global Handset Shipments Fall 8% in Q2 2009 - Hints of Recovery

­According to the latest research from Strategy Analytics, global mobile handset shipments fell 8 percent year-over-year, to reach 273 million units in Q2 2009. The rate of decline was slower than the previous quarter, as the market showed tentative signs of stabilization.

Bonny Joy, Senior Analyst at Strategy Analytics said, "Global mobile handset shipments fell to 273 million units during Q2 2009, down 8 percent from 297 million units in Q2 2008. The eight-percent shrinkage was a noticeable improvement on the huge declines recorded of minus 14 percent in Q1 2009 and minus 11 percent during Q4 2008."

Neil Mawston, Director at Strategy Analytics, added, "We believe the relative upturn in the global handset market has been driven by improved consumer confidence in some regions, such as China, and by partial restocking of some retailers' depleted supplies. Growth is certainly still available for those handset makers with compelling products and strong brands. For example, Samsung grew worldwide shipments a healthy 14% during the quarter, as consumers and carriers showed high interest in their touchphone models, such as Star and Jet."

Global Mobile Handset Shipments and Marketshare - Top 5 Vendors

Read more: http://www.cellular-news.com/story/38858.php#ixzz0Oabc3OHp

Not much surprise in WW LCD TV unit shipments, Samsung & LG grew QoQ to maintain its #1 & #2 positions worldwide at the expense of Sony and Sharp, Panasonic is coming back with 52% growth QoQ. LG is the only company to grow YoY

Worldwide LCD shipments grew 12% QoQ and 27% YoY,

DisplaySearch states that Samsung is #1 in shipments for Q2’09, however iSupply claims that Vizio is #1

DisplaySearch claims Funai as $3 player, whereas ISupply ranks Sony as $3 player in US

Global LCD TV Unit Shipments Stronger Than Expected, Reaching Record Levels in North America and China; Revenues Pulled Down by Falling Prices

Sort Date: 08182009

AUSTIN, TEXAS, August 18, 2009—In a nearly mirror image of Q1’09 results, global TV revenues fell 12% Y/Y to $23.7 billion while shipments declined slightly less, down 8% Y/Y to 44.6 million units according to the latest results from the DisplaySearch Quarterly Global TV Shipment and Forecast Report. Not all technologies fared equally though as LCD TVs continued to post remarkably strong unit growth, while all other technologies showed Y/Y declines in units. However in revenue terms, all technologies were down Y/Y as the marketplace remains impacted by frugal consumers looking for the lowest prices amid the global economic downturn.

Globally, flat panel TV share jumped from 68% in Q1’09 to 74% in Q2’09 as LCD TV price erosion continued at the same annual pace as Q1’09, falling 22% Y/Y on average. LCD TV market share increased as a result from 62% to 67%, acquiring nearly all that market share in a rapid shift from CRT to LCD in China as well as a big increase in North America market share from better than expected sell-through. Despite tight supply conditions for LCD panels in Q2’09, LCD TV shipment growth managed to maintain the same pace as Q1’09, rising 27% Y/Y to 30 million units although revenues fell 1% Y/Y. Plasma market share increased about half a percent to 7% while CRT share plummeted from 32% to 26% on a unit basis. Both North America and China reached record shipment levels.

“LCD TV market growth remains impressive, gaining market share from incumbent technologies like CRT at a quickening pace despite higher prices and a tight supply situation in Q2’09” noted Paul Gagnon, Director of TV North America TV Market Research at DisplaySearch. “Advanced technologies like high frame-rate LCDs and 1080p resolutions also continued to increase in market share as the price premium narrows, even in these tough economic times.”

North America dramatically took back the top position among global regions for TV shipments on a unit basis while reaching more than 10 million units shipped for the quarter. North America reclaimed the crown from China where unit shipments fell 10% Q/Q and 14% Y/Y, mostly on a large decline in CRT TV unit volume that wasn’t entirely made up by surging LCD growth. Western Europe continued to experience weakness with total units declining 3% Y/Y and was overtaken for the #3 market position by Asia Pacific. A review of global TV shipment performance by technology can be seen in Table 1:

Table 1: Q2‘09 Worldwide TV Shipments by Technology (000s)

Source: DisplaySearch Quarterly Global TV Shipment and Forecast Report

On a brand basis, Samsung remained the global brand share leader in revenues for the 14th straight quarter, rising to a record revenue share of 23.0% and also hitting a record unit share of 18.2%. LGE remained #2 after surpassing Sony in Q1’09, slightly increasing their revenue share to 13.7% with small share gains in both LCD and plasma offsetting a decline in CRT share. Sony held the #3 brand position worldwide in revenues, although losing a little more than a point of share.

Samsung reclaimed the top LCD unit share position from Vizio in the highly competitive North America market. Vizio fell to #2 on a unit basis in LCD TV for North America, but continued to see strong growth from a year ago with distribution in the growing discount channels like Walmart. Funai, which includes the Philips and Magnavox brand in North America, surpassed Sony and rose to #3, having the strongest Q/Q unit growth among the top five North America LCD TV brands. Funai is prospering from close strategy alignment with discount channels and more frugal consumers.

China remains a very competitive market as well, one dominated by domestic brands. The top five LCD TV brands in China on a unit basis are all Chinese and collectively account for nearly three-quarters of all units shipped to the region in Q2’09. Skyworth was the top LCD TV brand at nearly 20% unit share, but was followed closely by Hisense at #2. TCL rounded out the top three with 15% unit share. Many foreign brands are eager to gain a foothold in China’s rapidly growing market, but must compete with lower-cost Chinese brands to do so. Chinese consumer demand is currently being boosted by several government stimulus programs and TV brands are eager to participate, especially domestic brands. A complete review of the top five global TV brands can be seen in Table 2:

Table 2: Q2‘09 Worldwide TV Brand Rankings by Revenue Share

Source: DisplaySearch Quarterly Global TV Shipment and Forecast Report

 Vizio still maintains #1 position with a slight lead over Samsung in Q2’09. Samsung grew at the expense of Sony, LG and Sharp. Interesting to note, Panasonic grew significantly during Q2.

NA TV shipments grew 8.7% QoQ

 

Vizio maintains lead in US LCD TV market in 2Q09

Press release; Yvonne Yu, DIGITIMES [Tuesday 18 August 2009] While Vizio maintained its leadership in the US LCD TV market with 21.7% shipment share in the second quarter of 2009, Samsung Electronics closed the gap significantly as buyers gravitated toward its LED-backlit sets, according to iSuppli. Samsung's share of US LCD TV unit shipments rose to 21.3% in the second quarter, up from 17.8% in the first quarter. The gain represented the largest increase of any LCD TV brand in the US in the second quarter. With its strong rise, Samsung in the second quarter cut Vizio's lead to only 0.4 percentage points, down from 3.6 points in the first quarter. "Samsung in the second quarter was very aggressive in introducing and marketing its LED-backlit LCD TVs, allowing it to boost sales of these sets," said Riddhi Patel, principal analyst, TV systems, for iSuppli. "US consumers increasingly are warming up to higher-specification LCD TV models, including those using new LED-backlighting technology," Patel added. "iSuppli estimates 2.2% of LCD TVs shipped in the US in the second quarter used LED backlights, up from zero during the same quarter a year earlier. In mature markets like the US, while many consumers are moving up from their CRT or rear-projection TVs, an increasing number of LCD TV purchases are replacements of first-generation flat-panel sets. In these cases, consumers are gravitating toward higher-specification televisions, such as those with LED backlights." Unlike traditional CRT TVs that generate their own light, LCD TVs require an additional illumination source - or backlight - in order to present a visible image. LCDs historically have employed CCFLs as backlights. However, due to price reductions, LEDs in recent years have become a viable alternative to CCFLs. "LEDs deliver multiple advantages compared to CCFLs," Patel said. "These include achieving greater power savings and thinner form factors for LCD TV sets and the elimination of toxic materials employed in CCFL manufacturing." Global penetration of the LED-backlight technology for LCD TV panels will increase to 37% of all shipments in 2013, up from 3% in 2009, iSuppli predicts. Despite Samsung's surge, Vizio retained leadership in the US LCD TV market for the second consecutive quarter. "US-based Vizio continues to benefit from its combination of low-cost and full-featured sets, combined with its high-volume retail channels, including Wal-Mart," Patel said. "The company seems to have found the right balance between price and features that appeals to many consumers." The overall US LCD TV market posted a strong performance in the second quarter, with shipments rising by 8.7% to 6.9 million units, up from 6.3 million in the first quarter. This represents a major turnaround from the first quarter, when shipments plunged by 15.3%. "While sales of consumer electronics often decline in the first quarter compared to the hot holiday season in the fourth quarter, LCD TVs have been so popular that they have defied this trend in recent years," Patel said. "For example, US TV shipments rose by 5% sequentially in the fourth quarter of 2008. And even though the economic downturn clearly had a major impact on sales in the first quarter, the rebound in the second quarter shows the market has entered a recovery." iSuppli: LCD TV vendors ranking in US LCD TV market by shipment share, 2Q09 Rank Brand 1Q08 1Q09 2Q09 1 Vizio 14.7% 21.4% 21.7% 2 Samsung 12.6% 17.8% 21.3% 3 Sony 14.9% 14.8% 11.9% 4 Toshiba 6.7% 8.0% 8.3% 5 LG 8.5% 8.9% 7.9% 6 Panasonic 0.5% 3.7% 6.0% 7 Sharp 8.9% 8.6% 5.3%   Others 33.3% 16.8% 17.6%   Total 100.0% 100.0% 100.0%   Total shipments (k units) 5,127 6,313 6,863 Source: iSuppli, compiled by Digitimes, August 2009

 

FYI in the event you missed reading this

Results:

Q2’09 results sequentially increased 27%, however down 28% YoY
Q3’09 NXP expects sequential sales increase between 10 ~ 20%

Home BU revenues grew to $181M in Q2’09 vs $135 in Q1’09 – 34% sequential increase

►Market has improved compared to the first quarter 2009. However year on year the market is still down significantly

►QoQ sales increase across all businesses, but mainly driven by sales recovery in DTV after inventory corrections in the first quarter of 2009.

►EBIT improvement compared to first quarter of 2009 is mainly due to improved margins from higher sales and a lower cost base.

Home BU highlights:

TV550 is perceived by customers as the leading integrated digital TV platform in the market.

Two lead customers engaged on TV550 for 2010 model range, first mass production anticipated end 2009/early 2010.

Many additional opportunities underway

►Multiple engagements with panel customers and TV OEM’s on PNX5120 for cost effective Frame Rate Conversion and LED backlight dimming

►Significant recent design wins with key OEMs in STB Europe in terrestrial and satellite applications for major operators

►Ramp up of silicon tuners for STB with large OEM for major operator in the US

►Adobe’s Digital Home Flash Platform integrated into NXP’s STB Platforms enabling user friendly interface

NS

July 24, 2009

NXP Semiconductors Announces Second Quarter 2009 Results

Q2 Highlights

·                                 Q2 sales at USD 857* M versus USD 1,200 M in Q2 2008 (excl. wireless activities) and USD 673** M in Q1 2009.

·                                 Comparable QoQ sales increased by 26.2%. The increase in sales is largely attributable to supply chain replenishment and increased demand in China.

·                                 Q2 adjusted EBITDA (excluding effects of Purchase Price Accounting and incidental items) was a profit of USD 89 M, compared to a profit of USD 114 M in Q2 2008 and a loss of USD 71 M in Q1 2009.

·                                 Q2 Net income amounted to profit of USD 344 M compared to loss of USD 319 M in Q2 2008 and a loss in Q1 2009 of USD 568 M.

·                                 Cash position of USD 1,373 M at the end of Q2 compared to USD 1,706 M at the end of Q1 2009.

·                                 Factory loading of 53% in Q2 compared to 78% in Q2 2008 and 36% in Q1 2009.

·                                 Book to bill ratio at 1.20 in Q2 2009 compared to 1.18 in Q1 2009.

*) Excluding USD 46 million wafer sales to ST-Ericsson in Q2 2009
**) Excluding USD 29 million wafer sales to ST-NXP Wireless JV in Q1 2009

Eindhoven, The Netherlands – NXP Semiconductors today announced second quarter sales of USD 857 million, a comparable increase of 26.2% from the first quarter of 2009. The increase in sales is mainly attributable to supply chain replenishment following a soft first quarter of 2009 and the continued impact of various, mainly Chinese, stimulus packages.

Adjusted EBITDA in the second quarter amounted to a profit of USD 89 million, down from a profit of USD 114 million in the second quarter of 2008 and up from a loss of USD 71 million in the first quarter of 2009. Adjusted EBITA was a loss of USD 18 million this quarter compared to a loss of USD 29 million in the same period last year and a loss of USD 188 million in the previous quarter.

Net income for the second quarter of 2009 was a profit of USD 344 million compared to a loss of USD 319 million in the second quarter of 2008 and a loss of USD 568 in the first quarter of 2009. The increase in net income is largely attributable to higher financial income as a result of the bond exchanges.

The cash position was USD 1,373 million at the end of the second quarter compared with USD 1,706 million at the end of the first quarter of 2009.

The execution of the Redesign Program is on track. The fab in Caen was sold during the second quarter of 2009. The fab in Fishkill stopped production in early July 2009.

Outlook: The weak macro-economic conditions are still continuing. Although we have recently experienced positive order book developments, we believe this may be driven mainly by supply chain replenishment and not by a fundamental improvement of the semiconductors market, apart from China where we have seen real demand increase and recent improvements in other Asian countries. Considering the current business development we expect a sequential sales increase between 10% and 20% in the third quarter on a business and currency comparable basis (excluding wafer sales to ST-Ericsson). However, visibility beyond the third quarter is still limited.

FYI, in the event you missed reading this article

Although the article does not specifically comment on shipments, it appears that unit shipments are either flat or growing slightly however price declines are preventing YoY growth.

Here is the link to full article: http://www.isuppli.com/marketwatchdetail.aspx?ID=20482

CE Market Grew in Second Quarter

Stephen Silver

Jul 8, 2009

RSS Feed

");

_extended=true>

«   1 of 1   »

0

The global consumer electronics market has begun expanding again, but not enough to signify a true recovery. That's the conclusion of a report issued Tuesday by research firm iSuppli Corp., which believes that recovery will be delayed because prices are too low.

Following a first quarter in which revenue from global CE equipment fell by nearly 26 percent, the industry rebounded in the second quarter to a a 4.2 percent gain, to $71.1 billion. iSuppli predicted that revenue will rise by 12.5 percent and 10.2 percent, respectively, in the third and fourth quarters.

However, the firm forecasts an 8.2 percent decline for the year, to $307.6 billion, which iSuppli attributes to both the global economic downtown and lower prices.

“With the recession having eaten into consumers’ disposable incomes, the consumer electronics industry has responded by cutting prices on popular products,” iSuppli's senior analyst for CE, Sheri Greenspan said as part of the relaase of the data. “In diverse areas from digital still cameras, to video game consoles to LCD-TVs, manufacturers are offering price cuts to help move product.”