Advantest Shares Fall on Forecast for First-Half Loss

By Pavel Alpeyev

July 28 (Bloomberg) -- Advantest Corp., the world's biggest maker of memory-chip testers, fell the most in four months in Tokyo trading after the company forecast a loss in the first half on scaled-back investment in factories by chipmakers.

Advantest slid 6.1 percent to close at 2,170 yen on the Tokyo Stock Exchange, the biggest decline since March 3. Macquarie Group Ltd. reduced its 12-month price estimate 12 percent to 1,450 yen, citing slumping orders.

The first-half loss will probably be 2.5 billion yen ($23.1 million), Advantest said after the market closed on July 25, compared with a 16.9 billion yen profit for the same period a year earlier. Orders, an indicator of future sales, in the period will decline 62 percent to 36 billion yen, after plummeting 66 percent in the first quarter, it said.

The company didn't give a full-year outlook, citing difficulty in forecasting spending by chipmakers amid a glut that has caused companies such as Samsung Electronics Co. to report weaker earnings from semiconductors. Morgan Stanley and Nomura Holdings Inc. predict losses at makers of computer memory chips will continue this quarter as prices fall.

``It is looking increasingly likely Advantest will post a full-year loss'' as orders shrink, Hideyuki Maekawa, a Tokyo- based analyst at Credit Suisse Group, wrote in a July 25 report.

Sales in the first half will drop 57 percent to 50 billion yen, after declining 54 percent to 26.5 billion yen in the first quarter, the Tokyo-based company said.

Advantest reported a net loss of 152 million yen for the three months to June 30, compared with profit of 9.95 billion yen a year earlier.

To contact the reporter on this story: Pavel Alpeyev in Tokyo at palpeyev@bloomberg.net.