STMicro reports switch to profit, Ericsson factor hits stock
French-Italian semiconductor maker STMicroelectronics said on Friday it returned to profit in the second quarter but the news did not help its shares, hit by concerns over its Ericsson tie-up.
The company said it had a net profit of 356 million dollars (276 million euros) in the three months to June, compared with a loss of 318 million dollars in second quarter 2009.
Sales jumped 27 percent from a year earlier to 2.53 billion dollars and were up 8.9 percent from the first quarter.
Chief executive Carlo Bozotti said the figures allowed the company to confirm its 2010 forecasts for 20 percent sales growth after an expected 13 to 19 percent gain in the third quarter.
The fourth quarter, he said, looks equally strong.
On the Paris market, shares in STMicro, Europe's biggest chip manufacturer, were down 3.18 percent to 6.23 euros while the overall market was up 0.43 percent.
Dealers said the downturn reflected concerns over the company's venture with Swedish telecom equipment maker Ericsson which reported a gain in second quarter profits but a fall in sales on Friday, disappointing investors.
Ericsson shares slumped 5.5 percent in Stockholm on the news.
Bozotti said he was not happy with the results at ST-Ericsson, their specialist joint venture in wireless technologies.
© 2010 AFP