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Toshiba CE Segment Sales Dip 1%

10/24/2003 10:45:00 AM Eastern

Tokyo - Toshiba cited sluggish sales of projection television sets and cellular phones in North America helped drop digital products segment sales 1 percent in the company's fiscal second quarter, down to $4.7 billion, from a year-ago $4.8 billion.

Toshiba’s digital products segment, namely consumer electronics, reported an operating loss in the second quarter, ended Sept. 30, coming in at $97.3 million, compared with an operating gain of $61.9 million year on year. Toshiba blamed falling profit on severe price erosion within sales of personal computers, lower TV sales in the United States and a slide in domestic TV sales as the business shifted from picture tubes to flat panel displays.

Sales in North America dropped 19 percent in the second quarter, down to $1.8 billion, from $2.3 billion in the year-ago period. In the first six months, North American sales were off 24 percent, coming in at $3.1 billion, compared with $4.1 billion in the same time frame in 2002.

First half sales in Toshiba's digital products segment dipped 4 percent, down to $8.6 billion, from $9.1 billion in the same period a year ago. The segment registered an operating loss of $253.6 million in the six months, compared with operating income of $85.6 million year over year.

Toshiba widened its loss in the first half, with strong demand for digital camera memory chips failing to outweigh PC losses. Toshiba reported a consolidated net loss of $289.9 million in the first six months, on flat revenue of $23.5 billion, compared with a net loss of $240.8 million in the first half a year ago. The company recorded negative consolidated operating income of $108.1 million for the six months, compared with operating income of $26.2 million year over year.

Looking ahead to its full year, Toshiba expects consolidated sales to remain flat at $51.5 billion. Operating income is expected to increase 24.5 percent, to $1.3 billion, while net income should attain a 6.5 percent increase, to $228 million.

Digital products segment sales are expected to remain flat for the full year, at $18.9 million, while the 12-month operating loss should come in at $200.6 million, a 46.8 percent drop.