Fujitsu to post loss as it rejigs microchip arm

 
City A.M. Reporter
JAPAN’S Fujitsu expects to post an extraordinary loss of ¥ 170bn (£1.16bn) this business year due to the one-time costs of reorganising its microchip business and writing down the value of its European IT services arm.

Fujitsu and Panasonic said yesterday they are combining their struggling LSI chip units, which produce highly-customised chips used in a range of consumer electronics, confirming earlier reports.

As part of the reorganisation, Fujitsu plans to cut around 5,000 positions and transfer 4,500 staff into the new chip venture.

Fujitsu and Panasonic’s LSI chip businesses, which produce highly-customised microchips used in a range of consumer electronics including TVs and digital cameras, have fallen far behind aggressive South Korean rivals.

Japan’s largest computer maker also cut its annual dividend forecast.

Fujitsu expects its operating profit to reach more than ¥ 200bn in its 2015 financial year.

Yesterday it posted a 65.2 per cent drop in operating profit to ¥ 3.57bn for the nine-month period through December over the same period a year ago.