A 39 percent quarter-on-quarter decline in the chipmaker's average selling price led to a fourth-quarter net loss of 3.66 billion Taiwan dollars (112.6 million US), compared with a profit of 443 million in the previous three months.

The fourth-quarter loss includes a 990 million dollar write-down of the carrying value of its chip inventory.

Sales in the October-December period fell 21 percent quarter-on-quarter to 10.37 billion dollars; wafer shipments rose 6 percent while there was a 9 percent increase in bit terms, or the volume of chips calculated by capacity.

Charles Kau, president of the chipmaker, said DRAM prices are unlikely to stage a sustainable recovery until the second quarter of this year.

"Such a prospect is mainly based on restraints in capital expenditures by chipmakers over the past year," he said.

The recent firming of DRAM prices is mainly because of a temporary increase in demand in the run-up to the Lunar New Year holidays next month, Kau said.

In the coming year, Inotera expects its capital expenditure to total 30 billion dollars, against an actual 44 billion in 2007.

The bulk of this year's spending is meant to accommodate Inotera's migration to 70-nanometer technology and a pilot run of the new 58-nanometer technology.

Nanometer is used to measure spaces between transistors on a chip; the smaller the spaces, the more transistors to be packed on a chip. One nanometer equals one billionth of a meter.

Separately, Nanya recorded a net loss of 8.17 billion dollars in the three months to December.

Nanya does not expect an immediate return to profitability in the first quarter but believes a moderate improvement is possible, said Pai Pei-ling, a vice president of the chipmaker.

"The outlook for the second half seems more promising, with tightness on the supply side appearing a possibility," he said.

By: DocMemory
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