Philips will invest same in chip factories in 2004
Friday September 12, 4:45 am ET
AMSTERDAM, Sept 12 (Reuters) - Philips (Amsterdam:PHG.AS - News), Europe's third largest chip maker, said it expected its 2004 investments in its semiconductor factories to be similar to 2003 levels of around 300 million euros.
Investments over many years will remain below depreciation levels, currently estimated at some 750 million euros for 2003, Philips Semiconductors Chief Executive Scott McGregor said in an analysts presentation.
He also said he expected the global chip industry to increase sales by between nine and 10 percent this year, in line with market research forecasts.
Philips raises Q3 chips sales forecast
Intel, TI and now Philips see better-than-expected demand
By Emily Church, CBS.MarketWatch.com
Last Update: 4:58 AM ET Sept. 12, 2003
LONDON (CBS.MW) - Philips Electronics on Friday said sales in its semiconductor business were ahead of its expectations for the third quarter, sending shares of the largest electronics maker in Europe 5 percent higher in Amsterdam.
Philips (PHG: news, chart, profile) joined U.S. chipmakers Intel Corp. (INTC: news, chart, profile), Texas Instruments (TXN: news, chart, profile) and TriQuint Semiconductor (TQNT: news, chart, profile), each of which has upgraded projections for sales in the current quarter.
Ahead of an analyst meeting, Philips said it now expects the division sales in the third quarter, excluding mobile displays, to rise "a few percentage points" higher than an earlier projection for a 3 percent rise in sales over the second quarter.
Analysts had been looking for Philips to raise its target to around a 5 percent increase in sales over the second quarter.
"We expect further sequential growth in the fourth quarter," said Scott McGregor, CEO of Philips Semiconductors, in a statement. "The order book for the fourth quarter is progressing well, with the business on track to being profitable in the fourth quarter."
The sales upgrade lifted shares of Europe chip stocks, with STMicro (STM: news, chart, profile) rising 2.3 percent in Paris, Infineon (IFX: news, chart, profile) up 1.7 percent and chip equipment maker ASML (ASML: news, chart, profile) rising 4 percent.
Philips reiterated its expectation that the division, which it has been restructuring, will turn profitable in the last quarter of the year. It expects to take a 150 million euros charge ($168 million) in the third quarter for the restructuring, which Philips has said includes closing plants in Albuquerque and San Antonio.
Intel on Sept. 4 raised the lower end of its expected revenue range for its current third quarter to $7.6 billion from $7.3 billion.
Texas Instruments said on Sept. 9 said its third-quarter sales and earnings would be at the top end of its expectations due to strong demand for a broad range of its semiconductor chips. TI said it now sees 5 percent sequential revenue growth from an earlier projection of 2 percent.
TriQuint Semiconductor on Wednesday boosted its third-quarter financial targets, as well as its fourth-quarter revenue goal, due to good wireless demand and increased market share. |
