While the drop in profit was expected, weak margins at the company's lucrative medical-systems division bundas de loiras came as a surprise to investors, who sent the shares down more than 5%.
Net income generated by the maker of light bulbs, televisions and electric shavers fell to 331 million euros ($469 million), or 0.30 euros a share, from 4.24 billion euros, or 3.57 euros a share, in the year-ago quarter, when Philips (PHG:Philips Electronics N.V.
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4:02pm 10/15/2007
(NL:00953: news, chart, profile) recorded a gain of 4.19 billion euros from the sale of a majority stake in its chip division.
Income from continuing operations, which excludes gains and losses from disposals, rose to 333 million euros from 1 million euros a year earlier.
Overall sales climbed 3.3%, reaching 6.52 billion euros. bundas de loiras Goldman Sachs, however, told clients that revenue upside came mainly from the company's low-margin, consumer-electronics business.
Comparable sales rose 7%. Growth was particularly strong in emerging markets, Philips said, with sales in Latin America up 20%.
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