Japan Chipmakers, Slow to Adjust, May See Second Year of Losses
By Yoshifumi Takemoto
quote.bloomberg.com
Tokyo, May 1 (Bloomberg) -- Toshiba Corp. and other Japanese semiconductor makers may lose money for a second straight year because they have been slower to cut costs and move to more- profitable chips than competitors, analysts and investors said.
Toshiba, the world's second-largest chipmaker, and its four largest domestic rivals -- NEC Corp., Hitachi Ltd., Mitsubishi Electric Corp. and Fujitsu Ltd. -- last week reported a combined loss of 1.5 trillion yen ($11.7 billion) for the fiscal year ended March 31. Chipmaking accounted for much of the losses.
The companies are trying to recover from the industry's worst slump by spending billions of dollars to reduce staff and reorganize businesses. They have been tardy in making such moves, as well as in moving away from commodity-type chips to ones with higher profit potential, analysts said.
``Japanese chipmakers need a complete change in management to achieve real restructuring,'' said Fumiaki Sato, a Deutsche Securities analyst. ``The current managers are afraid to cut jobs and make drastic changes to their organizations.''
Industrywide chip sales tumbled to their lowest level on record last year as sales of personal computers and mobile phones slumped, causing makers of those products to curb chip orders.
Big Losses |
