NXP Semiconductors has reported falling profits and sales in the second quarter.

Sales of $1.524bn were 1.9% down on the same quarter last year and 0.6% down on the first quarter of 2008. This "reflects the continuing softness of the overall market," said the company.

"Due to the overall market sentiment we continue to see a relatively flat market. The company expects a year-over-year comparable mid single digit sales decrease," said NXP.

Mobile and analogue TV where the two most problematic markets as earnings before interest, taxes, depreciation and amortization (EBITDA) dropped to $114m, down from $190m in the second quarter of 2007 and down from $183m in the first quarter of 2008.

“We were able to achieve a sales level in line with our guidance, primarily as a result of solid sales performance by both the MultiMarket Semiconductors and Automotive & Identification businesses," said Frans van Houten, President and CEO of NXP Semiconductors.

"The Mobile & Personal business suffered from soft market conditions, but saw continued design-in traction in 3G, EDGE and Ultra Low Cost phones with Samsung,” said van Houten. 

The negative impact of the weaker dollar offset any gains from reduced costs an improved margins.

“The continued focus on our Business Renewal strategy resulted in improved gross margins, however savings have been eroded by the continuing weakness of the dollar. A core priority for the remainder of the year is to take additional decisive steps to mitigate our currency exposure and re-align our business to better suit our reduced size following the creation of ST-NXP Wireless,” vann Houten.

Due to the overall market sentiment we continue to see a relatively flat market. The company expects a year-over-year comparable mid single digit sales decrease, translating into similar sales levels as in the second quarter.

The full report is available on NXP website