All the chip makers have suffered due to a fall in demand for products that contain semiconductors, such as personal computers.

The price of the standard DRAM, or dynamic random access memory, chips has fallen to about one-tenth of last year's price.

But although some chip makers are very gloomy about the future, others expect a recovery to be imminent.

Toshiba

The bulk of the losses were suffered by Japan's chip maker, Toshiba.

The company reported net loss of 123bn yen (�700m; $1bn).

Toshiba also warned that its losses for the year could rise to 196bn yen. Previously, it had estimated losses of 120bn yen.

"We would like our microchip operations to become profitable. If there is further business deterioration, it is possible that we will cut more jobs," said president Tadashi Okamura.

Toshiba has already said it will cut 10% of its 30,000-strong workforce. These cuts are now expected to come sooner than previously thought.

Toshiba's profit and jobs warnings and the larger than expected losses sent the prices of shares in hi-tech companies into a tailspin in Tokyo trading.

NEC

Toshiba's smaller competitor NEC was hit by a net loss of 29.9bn yen during the six month period that ended on 30 September.