Due to sluggish sales of semiconductors and other major products, NEC Corp. announced Friday that it will report consolidated pretax losses of 20 billion yen for the first half of the current business year.
In revising its profit projection downward, the group also plans to report net losses worth 20 billion yen for the period ending Sept. 30, but it will try to report profits for the full year by implementing various restructuring measures, the company said.
The nation's major electronics firms have been hit hard recently by sharp declines in semiconductor prices and slumping sales of personal computers.
Earlier this month, Hitachi Ltd. announced that it will report its first postwar losses for the 1998 business year, and Toshiba Corp. also said that it expects no profit for the same business year.
In addition to sharp price falls of 64-megabit dynamic random access memory chips, NEC attributed the company's poor performance to declining equipment investment by Japanese corporations, especially for computers and other telecommunications devices.
NEC now expects to have consolidated sales of 2.2 trillion yen in the first half of the 1998 business year, down 7 percent from the same period last year.
While the company will try to cut planned fixed costs by 10 percent, including research and development investment, it will cut 5 percent of its 130,000-employee workforce within the next three years, said Shigeo Matsumoto, managing director of NEC.