DRAM market forces Qimonda in the red

In the first quarter of FY 2008, Qimonda recorded an EBIT loss of Euro 590 million compared to an EBIT loss of Euro 258 million in the fourth quarter of FY 2007 and a positive EBIT of Euro 250 million in the first quarter of FY 2007. Net loss was Euro 598 million, or a loss per share (basic and diluted) of Euro 1.75, compared to a net loss of Euro 265 million in the fourth quarter of FY 2007, or a loss per share (basic and diluted) of Euro 0.77. In the first quarter of FY 2007, Qimonda reported a net income of Euro 177 million or earnings per share (basic and diluted) of Euro 0.52. “During the last quarter, the DRAM market saw a further drop of more than 40 percent in standard DRAM pricing, one of the strongest declines in a December quarter. Our previously announced measures were executed successfully, but could not compensate for this difficult market environment,” said Kin Wah Loh, President and CEO of Qimonda AG. “We significantly reduced our cost per bit during the quarter by almost 20 percent based on strong bit shipment growth, productivity improvements in manufacturing and reduced operating expenses. Furthermore, we converted more than 50 percent of our capacities to 80nm and 75nm by the end of December. We are on track with our plans to reach a conversion rate of 75 percent by March and 90 percent by September 2008. In addition, we are significantly cutting our capital expenditure plan for the current financial year by Euro 250 million.”