UPDATE 2-Qimonda's loss narrows in Q3, revenue slumps

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By Nicola Leske

FRANKFURT, July 24 (Reuters) - Chipmaker Qimonda (QI1Ay.DE: Quote, Profile, Research, Stock Buzz), owned by Germany's Infineon (IFXGn.DE: Quote, Profile, Research, Stock Buzz), narrowed its operating loss in the third quarter but sales slumped on declining prices, the company said on Thursday.

The world's fourth-biggest maker of memory chips reported a loss before interest and tax of 386 million euros ($604.8 million) in the quarter to the end of June, compared with 468 million the quarter before, while sales fell 7 percent to 384 million euros from the second quarter.

Qimonda (QI.N: Quote, Profile, Research, Stock Buzz) said sales declined mainly due to a 45 percent decline in average selling price for the company's products compared with the prior-year quarter.

It said it could not compensate "the effect of the rapid and deep price decline" with higher bit shipments, which grew at a slower rate than past quarters as Qimonda cut less-productive capacity and improved manufacturing productivity.

It also booked restructuring charges of 20 million euros, mainly related to cost-reduction initiatives. For the fourth quarter, Qimonda expects to record another 10 million in restructuring charges related to cost cutting.

Net loss was 401 million euros compared with a loss of 482 million in the second quarter.

"We have reduced our loss in the third quarter and have made significant progress with our productivity improvement and cost reduction program, and we expect the impact to become noticeable in the current and next quarters," Chief Executive Kin Wah Loh said in a statement.