Chip makers see brighter outlook

The chip makers Infineon Technologies and STMicroelectronics yesterday sounded a slightly more positive note on the outlook for the troubled semiconductor industry, giving investors a flicker of hope that a recovery was around the corner.

Infineon, based in Munich, said there were "increasing signals" of positive developments in demand.

"The bottom is behind us but there's no reason for euphoria," said Ulrich Schumacher, president and chief executive of the German company.

At STMicro, Pasquale Pistorio, president and chief executive, said he believed the company's revenues had "bottomed out" in the first quarter of the year. "Importantly, this projected revenue gain is expected to reflect strengthened demand from virtually all of our end-markets," Mr Pistorio said.

STMicro yesterday posted first quarter net income of $32.9m (£22.7m), down from $45m in the fourth quarter of last year. Sales were $1.36bn, down 6.4 per cent from the fourth quarter of last year and well beneath the $1.9bn recorded in the first quarter of 2001.

Infineon, meanwhile, produced a second quarter net loss of €108m (£66m) compared with a €331m loss in the previous quarter.