Sharp Corp, the television maker that has shed 60 percent of its market value this year, widened its full-year loss forecast and announced job cuts as demand for liquid-crystal displays weakened more than expected.
The company said it would remain in the red for the rest of the year amid losses at its struggling TV business.
Net loss for the April-to-June quarter was ¥138.4 billion (US$1.76 billion), compared with a loss of ¥49.3 billion in the same period a year ago. Operating loss was ¥94.1 billion, plunging from an operating profit of ¥3.5 billion a year ago. Sales fell 28.4 percent to ¥458.6 billion.
The Osaka-based company will eliminate 5,000 jobs worldwide in its first job cuts since 1950 as global demand and prices tumble, and a yen near its postwar high against the US dollar erodes overseas earnings.
“About 5,000 jobs will be eliminated by March 2013 through natural attrition ... and voluntary retirement,” Sharp said in a statement.
Kyodo News said earlier yesterday that Sharp had originally considered cutting about 3,000 domestic jobs, but decided to expand the scope to include worldwide operations to accelerate a management restructuring.
Meanwhile, Sharp executives will take pay cuts of 20 percent to 50 percent, compared with originally planned 10 percent to 30 percent, Kyodo and broadcaster NHK said.
The company, which has seen its mainstay television, LCD and solar panel products units struggle, said the job reductions were part of a bid to cut fixed costs by ¥100 billion to help its dented balance sheet.
Sharp also downgraded its annual earnings forecast, saying it now expected an annual net loss of ¥250 billion for the fiscal year through March next year, a huge increase from an earlier projection for a loss of ¥30 billion.
The company also raised its annual operating loss estimate to ¥100 billion, from an earlier ¥20 billion.
Annual sales are expected to be ¥2.5 trillion, down from an earlier projection for ¥2.7 trillion, it said.
The steps come after it unveiled a plan in June to separate its TV-panel unit and in March turned to Foxconn Technology Group (富士康科技集團) and the Taiwanese company’s founder Terry Gou (郭台銘) for ¥133 billion in funding after forecasting its second straight annual loss.
Foxconn’s flagship Hon Hai Precision Industry Co (鴻海精密), the assembler of Apple Inc iPads, is to start buying panels from Sharp’s display venture this quarter, three months earlier than planned under a March agreement, Sharp president Takashi Okuda said in June.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by