Fujitsu has revised down its full-year financial forecast because of tough conditions in component markets and the strong Japanese yen. (Watch a slideshow of what CEOs are saying about the economy.)
The company expects net profit for the April 2008 to March 2009 period to be ¥60 billion ($610 million), a cut of 40% from its previous target. Fujitsu had originally expected net profits to double this year but the new estimate represents a drop of just under a fifth from those recorded last year.
Sales are forecast to be ¥5.05 trillion, a cut of 6% from its previous estimate. Compared with last year the new estimate represents an expected drop in sales of 5%.
Fujitsu said it expects to see significant declines in sales of LSI logic chips and tougher competition leading to lower sales of hard-disk drives, personal computers and mobile phones. The recent rapid appreciation of the Japanese yen will also hit results. A strong yen makes Fujitsu's products more expensive overseas. The company revised its yen-euro and yen-pound exchange rate forecasts for the remainder of the year and that also influenced the lower financial outlook.
The earnings forecast revision was delivered as Fujitsu reported financial results for the July to September quarter.
Net profit for the three months was ¥4.2 billion, down 22% on the same period last year, while sales were ¥1.3 trillion, a drop of 5%. Domestic sales fell by just over 1% but overseas sales dropped 11% on the same period in 2007.
Earlier this week Canon revised down its financial outlook because of the strong yen and tough market conditions. Last week leading consumer electronics company Sony also cut its estimates for the same reasons.
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