Toshiba yesterday said it was getting out the North American television business and selling its brand in the region to Taiwanese manufacturer Compal Electronics Co (仁寶電腦) as the conglomerate reported soaring nine-month earnings.
The Japanese company, which is involved in a range of businesses from power generation, transmission systems and medical equipment to computer chips and laptops, pointed to slowing TV sales for the decision to stop television development and sales in North America.
Compal is to sell TVs under the Toshiba brand, it said, adding that it was also in talks to license its brand to manufacturers in other TV markets outside Japan.
Japanese TV makers, which also include Sony and Panasonic, have suffered as razor-thin margins and fierce overseas competition dented their bottom lines.
“As the growth of [the] global [TV] market is slowing down and continues to see harsh price competition, Toshiba has decided to build a new business structure,” the company said in a statement.
The firm has said it would focus on ultra-high-definition 4K TVs in Japan and the rapidly growing emerging markets.
The announcement came as Toshiba said its net profit for the nine months to last month rose 85.9 percent to ￥71.9 billion (US$611 million), thanks to strong sales in the energy and infrastructure business, which includes nuclear power plants as well as electronic devices, including memory chips.
Japanese companies with big sales outside of Japan have also benefited from a sharp drop in the value of the yen, which inflates the value of repatriated income earned overseas.
Operating profit rose 6.2 percent to ￥164.8 billion, while sales rose 4.1 percent to ￥4.7 trillion, Toshiba added.
For the fiscal year to March, Toshiba maintained its forecast unchanged, expecting a net profit ￥120 billion on sales of ￥6.7 trillion.
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