Novellus ( NVLS) posted a wider than expected loss for its second quarter as demand for the company's chip-making equipment continued to slump.

On the top line, Novellus said its sales plunged 54% to $119 million from the year-ago period's $258 million.

Excluding charges, the San Jose company posted a loss of $39 million, or 41 cents a share, three cents shy of analysts' consensus targets of 38 cents.

With items, Novellus said it lost $50 million, or 52 cents a share, wider than the year-ago period's loss of $2.4 million, or 2 cents a share, when the recession was just gathering steam.

"While we have seen a rebound in orders off of historically low levels and are encouraged by increased customer activity, we remain determined to continue improving operating leverage and efficiency," Novellus CEO Richard Hill said in a statement.

"We are making the structural changes required to return to profitability before historical normalized industry conditions are restored."

Investors were bidding Novellus shares lower in after-hours trading Monday, changing hands recently at $18.28, down 2% from the close in the regular session, when the shares gained 60 cents, or about 3%.
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