Japan Display Inc (JDI) yesterday said it would slash 3,700 jobs, or about 30 percent of its workforce, as the struggling smartphone screen maker warned it lost money again in the second quarter of the year.
Citing intense competition, the Tokyo-based company said it would cut 3,500 positions at overseas assembly plants and another 240 jobs from its payroll in Japan.
The job cuts, which represent nearly 30 percent of the 13,100-strong workforce, are expected to save ¥50 billion (US$455 million) annually, it said.
Photo: Reuters
Japan Display, born out of the 2012 merger of the liquid crystal display divisions of Hitachi Ltd, Toshiba Corp and Sony Corp, has been lagging behind its foreign rivals as the industry shifts to new technologies.
“In this environment, JDI has surplus production capacity that represents a significant burden on the company’s manufacturing fixed costs,” it said in a statement.
“Therefore, JDI has determined that it must overhaul its manufacturing system to bring it in line with a changing market and reduce the level of fixed costs,” the company said.
Yesterday’s jobs announcement came as the firm logged a net loss of ¥31.5 billion in the April-to-June period, nearly three times higher than its shortfall in the same quarter a year earlier.
The group, which has been losing money for years, also expects to book a full-year operating loss due to heavier development costs to cope with growing demand for light-emitting OLED displays.
The company was slow to enter the market for OLED screens, which are more flexible than LCD screens and boast a sharper image.
They are increasingly becoming the preferred choice in high-end smartphones and Apple Inc is rumored to be planning a switch to OLED technology for its new iPhone, which is being launched this year.
Japan Display, which has factories in Japan and elsewhere in Asia, supplies screens to Apple and China’s Huawei Technologies Co Ltd (華為).
Public-private Innovation Network Corp of Japan is its top shareholder, with a stake of more than one-third in the company.
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