Sat, Dec 29, 2012 - Page 15 News List

Fujitsu likely to miss sales target as PC sales slow

Bloomberg

Fujitsu Ltd, Japan’s biggest provider of computer services, said the company will miss its annual shipment target for personal computers amid slow demand for Microsoft Corp’s Windows 8 operating system.

Initial demand for the software, introduced in October, is “weak,” Fujitsu president Masami Yamamoto told reporters in Tokyo on Thursday. A slump in demand in Europe resulting from the eurozone sovereign debt crisis will also erode sales he said. PC deliveries for the year ending March 31 next year could be more than 6 million units, compared with an October estimate of 7 million units, he said.

US retail sales of devices running Windows systems fell 21 percent from a year earlier in the four weeks after Microsoft released Windows 8 on Oct. 26, according to a Nov. 29 report by Port Washington, New York-based NPD Group Inc. The decrease has been fueled by a 24 percent drop in sales of notebook computers as customers opt for Apple Inc’s iPad or tablets powered by Google Inc’s Android software.

“We can’t be optimistic about the PC industry,” said Yoshihisa Toyosaki, a Tokyo-based analyst at Architect Grand Design, an electronics research and consulting company. “PC makers’ bet on Windows 8 has failed as cheaper tablet computers are taking away customers.”

Fujitsu is focusing on information technology services, helping it weather a slump in electronics sales that contributed to record losses at Sony Corp, Panasonic Corp and Sharp Corp. Yamamoto said the company does not plan to lower prices for its PCs, which along with mobile phones accounted for a combined 20 percent of Fujitsu’s revenue in the year that ended March 31, according to data compiled by Bloomberg.

“Fujitsu doesn’t plan to join its competitors in discounting [to sustain sales],” Yamamoto said. The company needs to strengthen its services in overseas markets, shifting from a product-focused approach, he said.

The company had said earlier it was counting on shipments in Europe and other overseas markets to account for more than half of total PC sales in the current fiscal year.

Shares in Fujitsu, a supplier to Samsung Electronics Co, fell 0.8 percent to ¥360 at the close of trading on the Tokyo Stock Exchange. The stock has declined 10 percent this year, compared with a 23 percent gain in the benchmark Nikkei 225 Stock Average.

Dell Inc, the world’s third-largest PC maker, said on Dec. 12 it is seeing strong demand for computers and tablets running Windows 8.

Interest in the operating system is “quite high,” Dell chief executive officer Michael Dell said at a conference in Austin, Texas.

Microsoft plans to overhaul how it develops its flagship Windows operating system in a strategic shift aimed at keeping pace with nimbler rivals Apple and Google, people familiar with the matter said last month.

Microsoft aims to upgrade the software more frequently, about once a year, rather than every two or three years as it has done in the past, the people said. The world’s largest software maker has floundered as personal computers, where it has long dominated, have lost ground to the smartphones and tablets championed by Apple and Google.

Fujitsu, the maker of the K supercomputer, will decide on a restructuring plan for its unprofitable chip business by March 31 next year, Yamamoto said, declining to provide details. The company is trying to rely more on other firms to make its chips instead of running its own chip-fabrication plants.

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