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The chips division of Philips, Netherlands, has in recent years been the driving force behind the company's profits, and so the firm has been hit hard by the crisis in the global semiconductor market.
Philips' semiconductor plant is currently operating at 40-45% capacity as the top priority is to reduce high stock levels.
In 1Q 2001 stocks grew by EUR 200 M but in 2Q they fell by EUR 100 M.
It is hoped that stocks will be further cut in order that profits can then be made more quickly during any recovery.
In addition, a 10% fall in the price of chips is forecast.
Philip's is expecting a greater fall in sales than its competitors, …