Chipmaker Infineon is struggling in the face of collapsing auto and electronics sales, but the company did find a few bright spots Friday even as it posted a first-quarter loss of over half-a-billion dollars.
Its loss for the quarter was narrowed and shares of the company rose 10 percent Friday morning as it unveiled plans for additional cost savings.
Like other chip makers, Infineon has fallen prey to disintegrating global automotive and electronics markets, where many of its chips find their homes. Its integrated circuits are used in wireless devices as well as cars. Infineon's memory chip unit, Qimonda, began insolvency proceedings last month, and the company has been affected by inventory reductions throughout the electronics supply chain.
For its first quarter, ended Dec. 31, the company reported a loss of 404 million Euros ($520 million), compared to a loss of 529 million Euros ($628 million) in the same quarter a year ago.
Revenue for quarter was 830 million Euros ($1.06 billion), down 28 percent sequentially and 24 percent year-over-year, the company said.
Infineon on a conference call with financial analysts to discuss the results did not rule out the sale of any parts of its business.
The company outlined cost-cutting measures it said will bring it annualized savings of 600 million Euros ($772 million), better than the previous savings targets of 250 million Euros. To reach that higher goal, the company has reduced work hours at its German production sites, changed its bonus plan and implemented a stringent travel policy, among other things, the company said in a statement.
"In the second quarter (ending March 31), market conditions will unfortunately worsen further," said CEO Peter Bauer, in the statement.The company currently expects second-quarter sales to decrease by roughly 10 percent compared with the first quarter.