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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Proud_Infidel who wrote (45623)	4/19/2001 8:14:14 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 70976

STMicro expects Q2 sales to drop 6-14% from first quarter Semiconductor Business News (04/19/01 09:44 a.m. EST) GENEVA--STMicroelectronics today reported a 12% sequential drop in net revenues to $1.92 billion in the first quarter, compared to $2.19 billion in Q4 of 2000. European chip maker also said sales in the second quarter are now expected to drop 6-to-14% from Q1 revenues because of weak market conditions. "The market correction, which began abruptly with a sharp inventory adjustment in the 2000 fourth quarter, is likely to continue through much of this year," said Pasquale Pistorio, president and CEO of STMicroelectronics. "Its duration is closely tied to macroeconomic conditions, particularly in the U.S. and Japan, as well as to industry-specific issues such as over-capacity and excess inventory levels." Consequential, STMicroelectronics is now expecting its net revenues to be in a range of $1.65 billion to $1.8 billion in the current quarter--below the $1.88 billion total last year. The company said it has implemented cost-controls during the slump, including a previously announced reduction in capital spending to $1.9 billion from a previous budget of $2.5 billion (see March 31 story). In the first quarter of 2001, STMicroelectronics' net income totaled $340.8 million compared to $238.4 million in the same period last year. While STMicroelectronics revenues were sequentially lower, its sales were nearly 13% higher than $1.70 billion in the first quarter of 2000. ST said chip shipments to telecom applications posted the strongest year-over-year growth, increasing 35.8%. Automotive was up 12.3%; computer increased 8.2%; and industrials and others--including smart cards--were up 17.5%. Digital consumer product revenues were down 11.4% from first quarter 2000 levels due to excess inventory conditions and a sharp decline in consumer demand, particularly in the U.S., said the company.