The company said automotive and identification, MMS, and home were the main contributors to the rise, while the mobile and personal sectors reported flat sales. Philips predicted mid-to-high single-digit sequential sales growth, in US dollar terms, for the third quarter.
It also said there had been a 15% reduction in net operating capital to 2.2bn euros ($2.8bn) in the past year, driven by the division’s asset-light strategy. One of the main beneficiaries of this was Taiwan Semiconductor Manufacturing Company Ltd, the world’s largest supplier of made-to-order chips, in which Philips has a 16.4% holding worth 5.7bn euros ($7.2bn) at the end of the second quarter.
Philips will over time be able to turn the holding into cash as its reinforces its holdings in steady product lines such as consumer electronics, lighting, and medical systems. By selling its chip operations, it will sever its last main connection with IT, but it is profiting hugely from its past investments in the sector.
