Toshiba cuts 2012-13 forecast on global economic woes

Toshiba cuts 2012-13 forecast on global economic woes

Summary: While the Japanese electronics maker generated profit in its second quarter earnings report, the firm has seen year-on-year decreases. Toshiba has also cut its forecast for the fiscal year.

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Japanese technology giant Toshiba has cut its full-year operating profit forecast to ¥260 billion ($3.25bn) or 13 percent after the firm warned of a contunued economic downturn, particualrly in Europe and Japan, adding that U.S. financial policies will also add to the turmoil.

However, Toshiba's second quarter results [PDF] show the firm is getting back on its feet after a rough past few quarters. The technology giant recorded ¥1.42 billion ($18.1 billion) in sales, a decrease of ¥169 billion ($2.12 billion) on the same quarter a year ago.

Meanwhile, the Tokyo, Japan-based firm posted a better-than-expected operating profit of ¥57.5 billion ($722 million), but the figure has fallen by 23 percent year-on-yea according to Reuters, due to falling revenue in its semiconductor, television and home electronics divisions.

The firm's social infrastructure unit recorded a "healthy performance" increase by 10 percent to ¥41.3 billion ($518 million), while its digital products and electronic devices units saw declines. Toshiba citied continued Japanese yen appreciation and market deterioration as a result of the quarterly poor performance.

Earlier this year, Toshiba cut its NAND flash memory production by 30 percent after the company oversupplied components. Its NAND chip business returned to profit in the quarter leading up to September, thanks to the iPhone 5's release in early September, in which Toshiba supplies the memory chips. The electronics giant will continue to see less severe production cuts during the third and fourth quarter between October 2012 and March 2013.

Toshiba's outlook expects lower sales and poor operating profits. While the firm's social infrastructure business pulls in healthy revenue, it has to make up for the other divisions' poor performance.

Topics: Toshiba, Tablets, EU, PCs, Tech Industry

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