The company now expects sales to decrease by at least 15 percent during its 2008-2009 fiscal year that began in October and sees a “negative result” for the aggregate of its five divisions, the company said in a statement.
It added that “there can be no assurance that Infineon’s plan to further reduce its interest in Qimonda will be successful” nor that Qimonda will be able to generate “adequate cash or result in desired operational efficiencies and cash savings.”
Shares in Infineon plunged by 23.36 percent to €1.27 in early trading on the Frankfurt stock exchange, while the DAX index was down by 2.07 percent overall. The fourth quarter figures are “disastrous,” Dow Jones Newswires quoted a trader as saying.
Infineon said that sales had gained just two percent to €1.153 billion in the last three months of its fiscal year, and that core earnings had fallen into a loss of €220 million from a €71 million profit in the previous quarter.
Infineon’s share price has lost nearly 80 percent of its value in the last year. The group had hoped to divest Qimonda, in which it owns a stake of 77.5 percent, by February. In its last fiscal year, Infineon made a net loss of €3.1 billion, almost 10 times more than a year earlier and almost entirely the result of Qimonda.
Qimonda is searching desperately for an investor and has also asked for public aid. Infineon has also dropped the idea of spinning off Qimonda by offering it to shareholders in the form of a dividend in kind, it said on Wednesday. The German group said it would try to extend its cost-savings programme that is designed to save €200 million per year and has already resulted in the loss of 3,000 jobs.
“The company has identified very substantial additional savings,” the statement said, though it would also likely mean a decrease in sales from the level expected up until now. For 2009, “visibility is very limited. Infineon believes that a significant decline in global semiconductor revenues from 2008 levels cannot be ruled out.”