Infineon Technologies on Monday posted a fourth-quarter profit, ending nine quarters of losses.
Infineon, the world’s sixth-largest maker of semiconductors, said net income was E49 million, or $56.5 million, compared with a loss of E505 million a year earlier. Revenue rose 37 percent to E1.76 billion.
For the year through September, the company reported a net loss of E435 million, compared with a net loss of E1.02 billion in 2002. Sales rose 26 percent to E6.15 billion.
“It’s good, but we fully expected this a quarter ago,” said Andrew Griffen, European semiconductor analyst at Merrill Lynch. “I can’t criticize what they’re doing – those who criticized them for investing heavily two years ago are now seeing those investments returning profits. But they’re in a tough industry, and their shares are overvalued.”
At the company’s annual news conference, Ulrich Schumacher, president and chief executive, cited cost savings through job cuts and outsourcing as well as an increase in the price of its core D-RAM products and reductions in its cost of producing them.
Schumacher said profit from the sale of Infineon shares in the Taiwan chipmaker ProMos had also added to the bottom line.
Fully 57 percent of revenue originated outside Europe, the Munich-based company said: 34 percent from Asia and 23 percent from North America.
Infineon also said it had become the third-largest chipmaker in the United States, overtaking Texas Instruments. Worldwide, Infineon said it had 4 percent of the market in semiconductors, up from 3 percent.
The company said it was on track to achieve its goal of 6 percent market share by 2007. It said that it expected demand for personal computers to increase in the current quarter and that the holiday season looked especially promising.
Peter Fischl, chief financial officer, said Infineon had set said E28 million to prepare for a possible adverse outcome of a U.S. Department of Justice investigation of price-fixing in the market for D-RAMs, chips that expand personal computer memory and help more programs operate simultaneously. Both Washington and the European Commission have been investigating any Infineon role in alleged price-fixing scheme.
Schumacher, asked about plans to move Infineon’s headquarters from Germany to a more tax-friendly country, said that the company was actively exploring the possibility and that it was not just a question of costs but also of productivity and speed to market.
“In our Chinese factories we are able to work three shifts per day seven days a week,” Schumacher said, adding that labor laws and work force costs in Germany constrain the company to work far fewer hours. “To ignore this is to imperil our very existence.”