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Tuesday, 29 January, 2002, 11:06 GMT
Toshiba posts $637m loss
Toshiba computer
Toshiba cuts its full year revenue target from PCs
Japanese electronics giant Toshiba has warned that the pain for itself and other personal computer makers is far from over.

The company reported a net loss of 84.9bn yen ($637.5m) for the three months from October to December.

And the world's second-biggest chip-maker forecast its full year losses would be even worse than expected, at $1bn.

The "severe business environment" will produce lower sales and income from PCs and digital media, it admitted.

Slashing costs

Toshiba, the largest chip firm in Japan, slashed its global workforce by 10% last summer and has since pulled out of making mass-market memory chips in favour of higher-margin products.

Last month, Toshiba president Tadashi Okamoto warned his firm was facing its "most severe situation since the founding of our company" 126 years ago.

And its earnings statement for the final three months of 2001 made clear its difficulties are far from over.

No shareholder payout

It has scrapped plans to pay a dividend to shareholders during its current financial year to March 2002.

Full year operating losses are now expected to be about 135bn yen ($1bn ), overshooting an earlier target of 110bn ($826m).

The three months to end-2001 saw "a continuation of the economic downturn that hit the United States in 2000 and a further slowdown in the demand for IT-related products", said Toshiba.

Layoff costs

Toshiba's third quarter loss comes on top of losses of 123bn yen ($965m) for the six months from April to September.

The third quarter loss contrasts with net profits of 11.1bn yen ($833m) for the October to December 2000 period.

The losses were caused by a combination of falling sales and falling prices, Toshiba said.

The price of mass-market memory chips, known as standard DRAM, or dynamic random access memory, fell by about 90% in 2001, prompting Toshiba to abandon making them.

The firm posted a 13% drop in sales for the last three months of 2001 to $1.21 trillion ($9.19bn).

Layoffs, a programme of voluntary retirement among Japanese workers and restructuring costs amounted to 157bn yen ($1.17bn).

See also:

18 Dec 01 | Business
Toshiba backs out of memory market
11 Dec 01 | Business
Toshiba warns of 'severe crisis'
27 Aug 01 | Business
Toshiba cuts 18,800 jobs
06 Feb 01 | Business
Toshiba hit by US slowdown
27 Aug 01 | Business
Japan 'aid' for unemployed?
25 Aug 01 | Business
Toshiba 'to axe 20,000 jobs'
20 Aug 01 | Business
Fujitsu to cut 16,400 jobs
26 Jul 01 | Business
Job cuts top 50,000
11 Jul 01 | Business
Japan's economy falters
20 Feb 01 | Business
Tech slump spreads to Japan
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