Tower sales up, but not yet profitable

August 15, 2007 – Israeli foundry Tower Semiconductor says sales rose 3% sequentially in 2Q07 and 28% year-on-year to $57.1 million, and it trimmed its net loss to $9.2M vs. $37.4M in 1Q07 and $34.4M a year ago.

The company noted that it has achieved sales growth for eight straight quarters (totaling a 3x increase), and added $25M to cash flow from operations vs. a year ago quarterly run rate.

In a statement, CEO Russell Ellwanger noted that Fab 2 is running “at very high utilization levels,” ahead of a next phase of capacity ramp approaching 24,000 wafers/month in 3Q07, for which it is currently raising money to acquire “low-cost, short-period-of-return toolsets.” Fab 1 utilization has decreased but should swing back up again by year’s end and into 2008 due to “multiple new projects with several very large customers,” he noted.

Tower projects 3Q sales to be flat to slightly up in a range of $56-$60M, representing 9%-17% year-on-year growth.

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