Infineon CEO Wolfgang Ziebart resigned after announcing the chip maker's worst quarter since being floated by Siemens eight years ago. Ziebart will step down at the end of Jun. Peter Bauer, who leads the company's automotive chip development division, will replace him temporarily while a successor is found.

Infineon's net profit for its second fiscal quarter more than halved to EUR19m (USD29m), from EUR45m (USD70m) in the previous quarter. Its EBIT also dropped sharply over the same period, to EUR36m (USD56m) from EUR65m (USD101m). The results were the latest in a continual slide, indicating that Ziebart’s attempts to move away from mass-market memory chips to high value models for mobiles and automobiles is not bearing fruit.

In 2006, Ziebart split the company’s memory chip production into a new entity called Qimonda and aggressively moved to cut Infineon’s stake in the entity. However, the company has now been forced to write down the value of Qimonda by around EUR1bn (USD1.5bn).

Infineon says the poor quarterly results were negatively influenced by the dollar/euro exchange rate but admits that projections for the next quarter are gloomy. Communications division sales expected to rise in single digit percentiles, while automotive chip business will decline by a similar amount.