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Fujitsu clocks Q1 loss; raises profit outlook

Fujitsu clocks Q1 loss; raises profit outlook
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First Published: Thu, Jul 30 2009. 12 04 PM IST
Updated: Thu, Jul 30 2009. 12 04 PM IST
Tokyo: Japan’s biggest IT services company, reported a smaller-than-expected quarterly loss thanks to aggressive cost cuts, and nudged up its its annual outlook for a bigger profit.
Fujitsu is trying to catch up with bigger rivals IBM and Hewlett-Packard but is struggling to shift focus away from its loss-making chips and electronics and concentrate on its server and services businesses.
It aims to sell its loss-making hard drive business to Toshiba Corp, cut costs in its chip operations and beef up its IT consulting sales overseas as growth prospects dwindle in Japan.
“The first half of the year is looking much better than expected, but there is no guarantee that this situation will last,” Fujitsu’s chief financial officer Kazuhiko Kato told a news conference on Thursday.
“Price competition is extremely severe especially in PCs,” he said, adding the company’s devices were now definitely on a recovery path.
Fujitsu raised its operating profit forecast to ¥90 billion ($948 million) in the year to March, above the ¥66 billion consensus estimate of 14 analysts polled by Reuters, and versus its previous forecast of ¥80 billion.
Japan’s biggest computer server vendor fell to an operating loss of ¥37.2 billion in April-June from a profit of ¥5.8 billion a year ago.
Fujitsu’s stock rose 44% in April-June, outperforming a 25% rise in the subindex as it made inroads in IT outsourcing in the US, the world’s biggest IT services market.
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First Published: Thu, Jul 30 2009. 12 04 PM IST