Sharp Corp lowered its operating profit forecast on slumping demand for smartphone displays in China and said it would not forecast net income until the results of reforms at the struggling liquid crystal display maker are clearer.
Operating income is likely to be ¥10 billion (US$83 million) for the year ending March 2016, compared with a previous projection of ¥80 billion, the company said in a statement yesterday. The net loss for the six months ended last month was ¥84 billion, compared with the 66 billion yen average of analyst estimates compiled by Bloomberg.
Sharp has posted net losses in three of the past four years as demand for LCD televisions and displays slumped and lower, while its rivals in South Korea and China increased their market share at the Osaka-based company’s expense.
The company is considering selling a stake in the LCD operation to Hon Hai Precision Industry Co (鴻海精密) or to Japan Display Inc owner Innovation Network Japan Corp, people with knowledge of discussions within the companies have said.
“Sharp needs to improve its performance in the second half to meet the ¥10 billion operating profit target,” Barclays PLC Tokyo-based analyst Kazunori Ito said by telephone.
“Additional restructuring is a road Sharp must go down,” Ito said.
The company reported an operating loss of ¥26 billion for the first half on a preliminary basis yesterday, compared with a forecast for ¥10 billion in operating income and a ¥29.2 billion profit in the period a year earlier.
Sharp is struggling under rising debt and has announced plans to sell the company’s headquarters, withdraw from the TV business in North America and cut back on solar panel manufacturing.
Taiwan’s technology protection rules prohibits Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) from producing 2-nanometer chips abroad, so the company must keep its most cutting-edge technology at home, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. Kuo made the remarks in response to concerns that TSMC might be forced to produce advanced 2-nanometer chips at its fabs in Arizona ahead of schedule after former US president Donald Trump was re-elected as the next US president on Tuesday. “Since Taiwan has related regulations to protect its own technologies, TSMC cannot produce 2-nanometer chips overseas currently,” Kuo said at a meeting of the legislature’s
GEOPOLITICAL ISSUES? The economics ministry said that political factors should not affect supply chains linking global satellite firms and Taiwanese manufacturers Elon Musk’s Space Exploration Technologies Corp (SpaceX) asked Taiwanese suppliers to transfer manufacturing out of Taiwan, leading to some relocating portions of their supply chain, according to sources employed by and close to the equipment makers and corporate documents. A source at a company that is one of the numerous subcontractors that provide components for SpaceX’s Starlink satellite Internet products said that SpaceX asked their manufacturers to produce outside of Taiwan because of geopolitical risks, pushing at least one to move production to Vietnam. A second source who collaborates with Taiwanese satellite component makers in the nation said that suppliers were directly
Top Taiwanese officials yesterday moved to ease concern about the potential fallout of Donald Trump’s return to the White House, making a case that the technology restrictions promised by the former US president against China would outweigh the risks to the island. The prospect of Trump’s victory in this week’s election is a worry for Taipei given the Republican nominee in the past cast doubt over the US commitment to defend it from Beijing. But other policies championed by Trump toward China hold some appeal for Taiwan. National Development Council Minister Paul Liu (劉鏡清) described the proposed technology curbs as potentially having
EXPORT CONTROLS: US lawmakers have grown more concerned that the US Department of Commerce might not be aggressively enforcing its chip restrictions The US on Friday said it imposed a US$500,000 penalty on New York-based GlobalFoundries Inc, the world’s third-largest contract chipmaker, for shipping chips without authorization to an affiliate of blacklisted Chinese chipmaker Semiconductor Manufacturing International Corp (SMIC, 中芯). The US Department of Commerce in a statement said GlobalFoundries sent 74 shipments worth US$17.1 million to SJ Semiconductor Corp (盛合晶微半導體), an affiliate of SMIC, without seeking a license. Both SMIC and SJ Semiconductor were added to the department’s trade restriction Entity List in 2020 over SMIC’s alleged ties to the Chinese military-industrial complex. SMIC has denied wrongdoing. Exports to firms on the list