Toshiba joins Japanese giants hunting for profit

Toshiba has reported a sudden drop in quarterly profit, dipping 72 percent on operating income of $1.1 billion for the fall quarter. The marked decline in profit also prompted the Japanese tech stalwart to issue a revised outlook (PDF) for its annual profit forecast based on lower than expected sales for the full fiscal year. The company blamed this on a number of factors, including unemployment rates in the US, the ‘severe’ state of the Japanese economy and the general weakness in the global economy. The company also said that it was impacted by the both the Japan earthquake and tsunami in March last year, and the floods in Thailand.

Toshiba’s results were based its wider electronics portfolio, which also includes white goods and even the development of nuclear reactors. Its weakest performer was its Digital Products and Electronic Devices segments, which posted lower operating income, though still recorded a profit. Its strongest performer was its Home Appliances division. Its computer sales dipped, following the overall downward trend in the global PC market, although its tablets are said to be performing well.

Toshiba’s television sales also saw a downturn as Toshiba, along with other Japanese TV making companies continue to struggle with the competition for cheap TVs from Korea and Taiwan. Toshiba is also the world’s number two supplier of flash memory chips behind Samsung, yet its semiconductor arm also struggled with decreased sales and lower prices forced by competition. Toshiba’s revised profit forecasts were largely based on continued revenue difficulties in its TV and semiconductors businesses. Shares in Toshiba have dropped by around 30 percent over the past twelve months.

By Electronista Staff