Fujitsu to cut 10 pct of workforce by March-paper
TOKYO, Aug 19 (Reuters) - Japanese giant chipmaker Fujitsu Ltd. <6702.T> will announce on Monday plans to cut its global workforce by 15,000, or nearly 10 percent, and to close some overseas factories, a newspaper reported on Sunday.
The company, Japan's biggest and the world's number-three flash memory chip maker, will carry out the job cuts by next March to counter the high-tech slowdown, the Nihon Keizai Shimbun business daily said without citing sources.
No one at Fujitsu was available to comment on Sunday.
Fujitsu shares closed on Friday at 1,211 yen each, up 0.58 percent on the day and just above the year low hit on July 27 of 1,035. In contrast, the Nikkei average fell on Friday to a 16-year low of 11,445.54.
Fujitsu had flagged plans to layoff workers and restructure its business when it forecast last month a 220-billion-yen ($1.83 billion) consolidated net loss for the year to March.
The forecast included a 280-billion-yen special loss in the first half to account for the restructuring. The special loss would total 300 billion yen for the full year.
The newspapers said Fujitsu, which reported a group operating loss of 42.3 billion yen in the first quarter, will consolidate its domestic and overseas plants for computers and telecommunications products.
ONLY 3,000 JOB CUTS IN JAPAN
Manufacturing plants in North America and the rest of Asia are expected to bear the brunt of the overhaul, with only 3,000 domestic workers losing their jobs, it said.
Fujitsu will stop overseas production of semiconductors and data storage units for personal computers, shifting resources from hardware to software and services.
In the semiconductor business, the main segment weakening the firm's earnings, Fujitsu is in talks to sell its memory plant in Oregon to Advanced Micro Devices Inc <AMD.N>, the newspaper said.
In Japan, Fujitsu plans to combine manufacturing lines at its chip plants in Iwate and Fukushima prefectures.
Fujitsu will end development of hard disk drives for PCs and shut down facilities for those products in Thailand and the Philippines.
It will also realign output at its four domestic plants and other subsidiaries.
SOFTWARE AND SERVICES ALLIANCES
In telecommunications, Fujitsu will stop producing switches in the U.S., concentrating instead on fibre-optic products.
Fujitsu will shift several thousand production workers to software and services divisions and create a task force to promote global corporate alliances and buyouts in these fields, the newspaper report said.
The PC market has slumped this year. Global PC shipments fell in the second quarter, marking the first year-on-year decline since 1986.
Fujitsu last month announced a four-week summer suspension in output of some flash memory chips, mainly used in mobile phones -- one of the hardest-hit sectors in this year's info-tech slump.
"It's not a particularly pretty picture right now," a Fujitsu spokesman said last month. "(As for) the production plans for flash in general, we're obviously looking at that now."
Analysts have predicted Fujitsu's once hugely profitable flash memory business will do little more than break even this financial year.
Fujitsu's stronghold in the software and service segment is suffering from slow domestic demand because debt-ridden Japanese banks are cautious about providing credit to companies for expenditure on information technology, analysts said.
The company has cut semiconductor capital expenditure plans for this business year to 140 billion yen from the originally-planned 190 billion yen. The budget is down 28.9 percent from actual spending a year earlier.
It has cut its chip output target to 475 billion yen from an originally planned 690 billion yen, down 24.6 percent from actual output a year ago.
($1=120.44 Yen)
23:44 08-18-01
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TOKYO, Aug 19 (Reuters) - Japanese giant chipmaker Fujitsu Ltd. <6702.T> will announce on Monday plans to cut its global workforce by 15,000, or nearly 10 percent, and to close some overseas factories, a newspaper reported on Sunday.
The company, Japan's biggest and the world's number-three flash memory chip maker, will carry out the job cuts by next March to counter the high-tech slowdown, the Nihon Keizai Shimbun business daily said without citing sources.
No one at Fujitsu was available to comment on Sunday.
Fujitsu shares closed on Friday at 1,211 yen each, up 0.58 percent on the day and just above the year low hit on July 27 of 1,035. In contrast, the Nikkei average fell on Friday to a 16-year low of 11,445.54.
Fujitsu had flagged plans to layoff workers and restructure its business when it forecast last month a 220-billion-yen ($1.83 billion) consolidated net loss for the year to March.
The forecast included a 280-billion-yen special loss in the first half to account for the restructuring. The special loss would total 300 billion yen for the full year.
The newspapers said Fujitsu, which reported a group operating loss of 42.3 billion yen in the first quarter, will consolidate its domestic and overseas plants for computers and telecommunications products.
ONLY 3,000 JOB CUTS IN JAPAN
Manufacturing plants in North America and the rest of Asia are expected to bear the brunt of the overhaul, with only 3,000 domestic workers losing their jobs, it said.
Fujitsu will stop overseas production of semiconductors and data storage units for personal computers, shifting resources from hardware to software and services.
In the semiconductor business, the main segment weakening the firm's earnings, Fujitsu is in talks to sell its memory plant in Oregon to Advanced Micro Devices Inc <AMD.N>, the newspaper said.
In Japan, Fujitsu plans to combine manufacturing lines at its chip plants in Iwate and Fukushima prefectures.
Fujitsu will end development of hard disk drives for PCs and shut down facilities for those products in Thailand and the Philippines.
It will also realign output at its four domestic plants and other subsidiaries.
SOFTWARE AND SERVICES ALLIANCES
In telecommunications, Fujitsu will stop producing switches in the U.S., concentrating instead on fibre-optic products.
Fujitsu will shift several thousand production workers to software and services divisions and create a task force to promote global corporate alliances and buyouts in these fields, the newspaper report said.
The PC market has slumped this year. Global PC shipments fell in the second quarter, marking the first year-on-year decline since 1986.
Fujitsu last month announced a four-week summer suspension in output of some flash memory chips, mainly used in mobile phones -- one of the hardest-hit sectors in this year's info-tech slump.
"It's not a particularly pretty picture right now," a Fujitsu spokesman said last month. "(As for) the production plans for flash in general, we're obviously looking at that now."
Analysts have predicted Fujitsu's once hugely profitable flash memory business will do little more than break even this financial year.
Fujitsu's stronghold in the software and service segment is suffering from slow domestic demand because debt-ridden Japanese banks are cautious about providing credit to companies for expenditure on information technology, analysts said.
The company has cut semiconductor capital expenditure plans for this business year to 140 billion yen from the originally-planned 190 billion yen. The budget is down 28.9 percent from actual spending a year earlier.
It has cut its chip output target to 475 billion yen from an originally planned 690 billion yen, down 24.6 percent from actual output a year ago.
($1=120.44 Yen)
23:44 08-18-01
Copyright 2001 Reuters Limited. |
