NXP Semiconductors reported “continuing softness” in the semiconductor market as first quarter sales dipped 7.5% on the previous quarter.

First quarter sales of $1.5bn were marginally ahead on the same quarter last year.  

Pre-tax profit was $183m, well down from $349m in the fourth quarter of 2007.

“We were able to achieve a sales level in line with our guidance provided, as the result of better than anticipated sales in both the multi-market semiconductors and automotive & identification businesses,” said Frans van Houten, president and CEO of NXP Semiconductors.

“Our cash position has reduced in the first quarter to $519m. We continue to strengthen our operations and remain on course to deliver USD 375 million of cost savings on a run-rate basis by the end of 2008,“ said van Houten.

The chip maker is in the middle of a period of restructuring and recently announced a joint venture with STMicroelectronics in the wireless business. “This transaction will give us a significant minority stake in an ambitious and exciting joint venture, as well as $1.5bn in cash enabling us to pursue growth and expansion in our remaining core sectors,” said van Houten.

NXP has also set-up a joint venture with Thomson Multi Media and acquired Conexant’s set-top box operations.

The company expects a year-on-year mid single-digit sales decrease on a comparable basis.