No recovery in sight for tech's big players


General concern that economic uncertainty will continue to dampen consumer spirits has dashed hopes of a tech recovery later this year

From Kristie LuStout
CNN Tech Correspondent

HONG KONG, China (CNN) -- The world's largest contract chip maker Taiwan Semiconductor dropped a bombshell on global equities markets with its pessimistic profit outlook.

TSMC's usually bullish chairman Morris Chang told investors Thursday that "beginning in the third quarter... is a pause of the recovery."

The chip maker on Thursday reported a quarter on quarter rise in net income, to $280 million, but came in below analyst expectations.

In a sign that things could get worse before they get better, TSMC also said it would cut back on capital spending by at least 20 percent this year alone.

Chang's bearish comments echo a similar statement from tech giant Intel.

TECHWATCH

Spiderman nets Sony profits

Sony also handed in its first quarter report card on Thursday.

The world's largest consumer electronics maker cashed in on its hit movie "Spider-Man" and brisk electronics sales to post an operating profit of $444 million (51.87 billion yen).

Reporting 17 times what it logged in the same period last year, and far exceeding analysts' profit expectations of 10 billion yen.

Analysts estimate Spider-Man's record-breaking success at the box office to have earned an extra $172 million (20 million yen) in extra operating profit for Sony's movie arm. (Full story)

NEC also joined the tech giants in posting its results Thursday.

Japan's second largest chip maker reported an operating loss of $60 million for the April to June period -- reversing profits in the 12-month period.

This was, however, in line with forecasts.

The company is relying on a chip-market rebound and cost cutting to keep its red ink under control.