UPDATE 2-MEMC earnings tumble, but beat Wall St view

* 2nd-qtr EPS 3 cts vs breakeven estimate

* Net sales down 47 pct to $282.9 mln

* Sees sales climbing in third quarter

* Shares firm in post-market trade

(Adds details, CEO comment, background)

NEW YORK, July 23 (Reuters) - Silicon maker MEMC Electronic Materials Inc (WFR.N) on Thursday reported a steep decline in quarterly profit, but beat Wall Street forecasts, boosting its stock in post-market trade.

The maker of the key raw material for the solar and semiconductor industries has been hurt by the sharp drop in silicon prices as the weak economy shrunk demand for chips and financing dried up for solar projects.

Second-quarter net profit fell to $6.5 million, or 3 cents per share, compared with $176 million, or 76 cents per share, a year ago.

Wall Street analysts, on average, had been expecting breakeven results, according to Reuters Estimates.

Net sales fell 47 percent to $282.9 million.

Still, sales should increase to between $300 million to $350 million in the current quarter, the company said.

"Based on current customer indications, we believe that demand should continue to improve in the semiconductor industry during the third quarter," Ahmad Chatila, MEMC president and chief executive officer, said in a statement.

Demand from the solar industry, however, was less clear, he said. But the company expanded its customer base and signed a letter of intent with a leading solar company during the quarter to use MEMC wafers in a new joint venture.

Polysilicon prices went as high as $500 a kilogram last year due to shortages as solar manufacturers scrambled to buy supplies. But new production capacity and shrinking demand has pushed those prices near the $50 mark in recent weeks.

Shares in MEMC were up nearly 1 percent to $21 in post market trade after initially climbing about 6 percent.

(Reporting by Matt Daily and Nichola Groom in Los Angeles; editing by Gunna Dickson, Bernard Orr)