Conexant Sees Loss Double in Quarter

Conexant Systems Inc., pointing to a “challenging market” for its products, posted wider losses for the fiscal third quarter that were in line with recently lowered expectations.

The Newport Beach communications chip maker, which has cut 23% of its work force since April, said it lost $112 million, or 45 cents a share, excluding one-time charges, more than doubling the loss of $53.3 million, or 24 cents a share, for the third quarter last year. Analysts had anticipated a loss of 45 cents a share, according to a survey by First Call/Thomson Financial. Revenue tumbled to $200 million from $530 million.

Conexant, which had warned about the depressed results when it announced a new round of layoffs July 9, released the results after regular U.S. trading hours. The stock moved up 50 cents to $8.59 a share on the Nasdaq market, then fell as low as $8.10 in after-hours trading following the report. The shares have lost 82% of their value over the last year.

The slowing U.S. economy has blunted demand for personal computers, cellular phones and telecommunications equipment that use Conexant’s chips. Sales probably will decline again in the current quarter from the fiscal third period, Conexant said.

But revenue is showing signs of stabilizing in the personal networking segment, said Dwight Decker, chairman and chief executive. This unit, which makes chips for such communications products as cable modems, digital set-top boxes for television sets, mobile phones and wireless networking, logged revenue of $164 million, down 3% from the second quarter.

“We believe our personal networking business has found its bottom,” Decker said, predicting that its revenue for the current quarter will be flat.

The company’s Internet infrastructure business continued to take a beating as revenue fell 56% to $36.1 million.

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Reuters and Bloomberg News were used in compiling this report.