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To: SusieQ1065 who wrote (59230)	7/3/2002 7:10:30 AM
From: SusieQ1065	Respond to of 208838

Euro chips down on AMD warning STMicro, ASML, Philips, Infineon drop on sales caution By Kevin Morrison FT Investor, 11:14 BST Jul 3, 2002 LONDON (FT Investor) - The European chip sector took another battering on Wednesday as Advanced Micro Devices, the world's second largest microprocessor producer issued its second sales warning in less than a month. Shares in German chip maker Infineon [623101, News, Chart, Research] [IFX, News, Chart, Research], Dutch chip makers ASML [33436, News, Chart, Research] and Philips [00953, News, Chart, Research] [PHG, News, Chart, Research] all fell more than 3.5 per cent. Franco-Italian owned STMicroelectronics [012970, News, Chart, Research] was the only major European chip maker to contain losses to less than 3 per cent, dropping 2.8 per cent to €22.98. UK chip designer ARM Holdings [ARM, News, Chart, Research] fell 3.6 per cent to 128.5p, extending the 8.7 per cent fall on Tuesday. The previous drop was inspired by a warning by US chip designer MIPS Technologies [MIPS, News, Chart, Research] that sales for the June quarter would be almost 25 per cent below forecasts. Weaker market The share price drops were greater than the broader market falls with the major European markets easing about 2 per cent as accountancy issues and fears about corporate ethics continued to concern investors. See European markets report. AMD [AMD, News, Chart, Research] said it expected sales in the second quarter to be about $600m. This latest cut followed a warning last month, when the company lowered sales guidance for the quarter ending June to between $620m and $700m, and warned that it expected to make a "substantial operating loss" for the quarter. AMD, which has a 20 per cent market share, had originally forecast second-quarter sales in the $820m-$900m range. See AMD story on FT.com More chips please The warning by AMD overshadowed mildly positive news from the Semiconductor Industry Association, the industry body that represents US chip makers, which on Tuesday said global sales of chips jumped 2.8 per cent to $11.37bn in May from April. The sales increase was boosted by chip sales for mobile phones and consumer electronics that offset a decline in computer chips. See May chip sales story on FT.com. European chip makers have been severely hit by warnings from US chip makers in the past month. In early June Intel Corp [INTC, News, Chart, Research] warned that slower sales in Europe had caused it to cut second-quarter sales estimates. See Euro chips fall on Intel warning story. When AMD last warned on June 18, European chip-makers fell between 1 and 8 per cent. See Tech stocks show some resilience story.