He believes falling GDPs (gross domestic product) in the economies of the US and European countries is now a major concern for the chip industry.
“Everyone has been worried for the last three to four months,” Beyer, told Electronics Weekly.
“We are in a normal downturn, a demand driven downturn,” said Beyer.
"Looking ahead to the fourth quarter, we expect the weakness in the semiconductor market to continue to negatively impact our business," said Beyer.
The build up of inventory in the supply chain began in the first half of the year following the earthquake and tsunami in Japan.
“Inevitably companies stocked up on parts and this created inventory build,” said Beyer.
“This inventory build was largely worked through in the third quarter, but now the market is being affected by falling demand as a result of falling GDPs,” said Beyer.
But these up and down movements of the market are nothing new for semiconductor companies.
“In the semiconductor industry we are used to cycles,” said Beyer. “We all have variable cost structures.”
“Despite challenging macroeconomic environment conditions, we continued to generate solid gross margins," said Rich Beyer, chairman and CEO.
Net sales for the third quarter were $1.14bn, compared to $1.22bn in the second quarter and flat with a year ago.
Profit from operations in Q3 was $110m, compared to $31m in the second quarter of 2011.
Costs and debt charges resulted in a net loss for the third quarter of $88m. But this was an improvement on the $168m loss in Q2....RESOURCES
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