Semiconductor Manufacturing International swings to 1Q loss

NEW YORK—Chinese chip maker Semiconductor Manufacturing International Corp. said Tuesday it swung to a first-quarter loss on a drop in value of its memory chip business and an overall decline in sales.

The company reported a loss of $119 million, or 32 cents per American Depositary Share, compared with a profit of $8.8 million, or 2 cents per ADS, in the first quarter of 2007.

Sales fell 6.7 percent to $362.4 million from $388.3 million.

The company also said it will exit the DRAM memory chip business. DRAM is one the most common types of memory chip and are typically found in personal computers. SMI has hired an external evaluator to assess if it has suffered any overall impairment charge on the value of its DRAM business.

The company lost $44.5 million on the price of its DRAM inventory during the quarter as prices remained depressed. It is not alone in suffering a loss in its memory chip business.

The price of memory chips has slumped in the last year because of a global oversupply.

U.S.-traded shares of Semiconductor Manufacturing International rose 2 cents to $3.87 in midday trading.