Awash in red ink, Fujitsu jettisons another 4,600 staff
- 25 October, 2001 16:50
Fujitsu on Wednesday announced it would lay off 4,600 workers as the company reported its first-ever loss and said financial losses for its 2001 fiscal year would exceed forecasts. The layoffs come on top of 16,400 staff cuts announced by Fujitsu in August.
For the first half of Fujitsu's 2001 fiscal year, which started on April 1, the company reported a consolidated net loss of 174.7 billion yen ($2.8 billion), compared to net income of 17.2 billion yen during the same period one year ago, the company said. The loss came on consolidated net sales of 2.4 trillion yen, a decrease of 4 per cent compared to the same period last year.
The results represent the first-ever half-year operating loss for Fujitsu since the company was founded in 1935, it said.
Fujitsu blamed the poor financial results on weak demand, lowered prices of electronic devices, and further deterioration of the financial conditions of telecommunication carriers in North America. The company's telecommunication sales declined 7 per cent to 315 billion yen, compared with the year-ago period. Sales of electronic devices declined 18 per cent to 296 billion yen.
At the same time, Fujitsu lowered its forecast for the 2001 fiscal year and announced further measures to restructure the company. The new measures include an additional 4,600 layoffs, most of which will be conducted overseas, to be completed by the end of its 2002 fiscal year. Originally, the company was planning to lay off 16,400 workers to reform the entire group.
The company lowered its net sales forecast to 5.2 trillion yen, 200 billion yen less than earlier forecasts announced in July. Net losses for the 2001 fiscal year are expected to reach 310 billion yen, up sharply from the company's previous estimated loss of 220 billion yen.