German chipmaker Infineon has reported a heavy quarterly loss, saying that the outlook for semiconductor sales remains grim.

The firm lost 523m euros (�322m; $468m) in the three months to the end of September, compared with a 371m euro loss in the previous three months.

Sales slumped 15% to just over 1bn euros, and are now at less than half their levels a year ago.

Infineon offered little comfort to the sector, saying its forecasts pointed to a 30% decline this year, with only modest growth in 2002.

"The market development in the next six months remains uncertain and will be impacted by the slowdown of the world economy and the uncertainty of the current global political environment," the company said in a statement.

Memory problems

Infineon, the world's fourth-largest producer of computer memory chips, has been particularly hard hit as prices for dynamic random access memory chips (DRAM) have sunk well below the cost of production.

All of its main rivals have reported a loss in the memory chip business for the latest quarter.

Infineon's latest results came within the range of analysts' expectations, which helped its shares gain by 1% in early trading.

Infineon's shares, which have fallen sharply since the technology-market collapse of mid-2000, have risen by almost 70% since 11 September, as investors turned to technology stocks as a safe haven.

Cost-cutting

Infineon has struggled to control costs this year.

In July, it announced up to 5,000 job cuts in a restructuring plan aimed at achieving savings of about 1bn euros over 12-18 months.

The firm also introduced short-time working.

In late August, it emerged that the firm was in talks over a tie-up deal with Japan's Toshiba, which has also suffered tough times this year.