Panasonic Corp. said Wednesday it is projecting a full year loss amid falling demand for its Viera TVs and additional restructuring costs.
The net loss will probably be ¥765 billion in the business year ending March 31, the company said, scrapping its May projection of ¥50 billion in net income.
Panasonic, Sharp Corp. and Sony Corp., Japan’s three biggest TV makers, are cutting jobs and closing production lines to recover from record losses amid slumping demand and rising competition from South Korea’s Samsung Electronics Co. and LG Electronics Inc.
Panasonic eliminated 38,387 positions in the year through June 30 and promoted Kazuhiro Tsuga to president after he led restructuring of the firm’s TV business.
“TV demand remains weak, and Panasonic faces more pressure from its slowing mobile-phone business, lithium-ion batteries and system LSI chips,” Junya Ayada at Daiwa Securities Co. said before the announcement.
“More aggressive reform is needed, and President Tsuga will probably disclose a revival plan by the end of the fiscal year.”
Tsuga has pledged to revive Japan’s largest maker of home appliances “by all means.” Losses from TVs at Panasonic totaled ¥349 billion in the past four fiscal years, according to an estimate by Yuji Fujimori, an analyst at Barclays.
Global TV shipments fell last year for the first time since 2004, according to DisplaySearch, part of NPD Group. Worldwide TV shipments declined 8 percent in the second quarter from a year earlier, the research company said Sept. 11.
Slowing sales in China and a weaker outlook for businesses related to electronic devices and facilities investment also are pressuring Panasonic, Takashi Watanabe, an analyst at Goldman Sachs Group Inc., said in a report Oct. 16.
Watanabe cut his full-year earnings estimate for the company to a net loss of ¥335 billion from his earlier projection for a ¥30.4 billion profit, citing additional restructuring costs.
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