Yen at Four-Year Low Prompts Fujitsu to Raise PC Prices

May 13 (Bloomberg) -- The yen fell for a fourth day versus the dollar after Group of Seven finance chiefs indicated they will tolerate a slide in the currency for now as they intensified their focus on Japan’s recovery strategy. John Dawson reports on Bloomberg Television's "First Up." (Source: Bloomberg)

Fujitsu Ltd. (6702), a Japanese maker of personal computers, plans to raise domestic prices as the yen’s drop to a four-year low boosts the cost of importing components.

The price increases will take effect by July and apply to models released in the summer, Chief Financial Officer Kazuhiko Kato said in an interview at Fujitsu’s Tokyo headquarters. The company may also curb discounts on existing lines, he said.

Fujitsu’s FMV PC’s rely on imported components and software, including chips from Intel Corp. (INTC) and the Windows operating system from Microsoft Corp. The yen weakened beyond 101 per dollar last week, the first time at that level since April 2009, as Prime Minister Shinzo Abe spearheads measures to drive down the currency to revive the economy and end deflation.

“It’s impossible to change our suppliers as we’ve been taking measures to combat a strong yen,” Kato said.

The PC maker plans to increase the use of materials common to multiple models to lower costs and reduce the number of products it sells, he said.

Fujitsu, which also makes mobile phones and network equipment, rose 3.4 percent to 428 yen at the close of Tokyo trading. The stock has risen 19 percent this year, compared with a 42 percent gain in the benchmark Nikkei 225 Stock Average.

Photographer: Kiyoshi Ota/Bloomberg

The Fujitsu Ltd. logo is displayed on the company's FMV laptop computer as a sales clerk speaks to a customer at an electronics store in Yokohama City, Kanagawa Prefecture, Japan. Fujitsu’s FMV PC’s rely on imported components and software, including chips from Intel Corp. and the Windows operating system from Microsoft Corp. Close

The Fujitsu Ltd. logo is displayed on the company's FMV laptop computer as a sales... Read More

Close
Open
Photographer: Kiyoshi Ota/Bloomberg

The Fujitsu Ltd. logo is displayed on the company's FMV laptop computer as a sales clerk speaks to a customer at an electronics store in Yokohama City, Kanagawa Prefecture, Japan. Fujitsu’s FMV PC’s rely on imported components and software, including chips from Intel Corp. and the Windows operating system from Microsoft Corp.

The yen weakened to 101.65 per dollar at 3:14 p.m. in Tokyo.

The slide in the currency is making Japanese products more competitive in overseas markets, boosting exporters including Sony Corp. and Mazda Motor Corp. (7261) who get the majority of revenue from outside Japan.

Job Cuts

Fujitsu got 66 percent of sales from the domestic market in the year ended March.

The company, Japan’s biggest provider of computer services to companies, is focusing on information and communication technology including cloud computing to weather a slump in sales of chips used in televisions and other electronics.

About 5,000 jobs are being cut while 4,500 workers will be transferred to other companies, it said in February.

Fujitsu last month forecast net income of 45 billion yen this fiscal year, after reporting a 72.9 billion yen loss for the 12 months ended March. Sales will probably rise 3.8 percent to 4.55 trillion yen.

Toshiba Corp. (6502) may also raise PC prices, it said May 8.

Global PC unit shipments fell 14 percent in the first quarter -- the worst such decline on record -- to 76.3 million, market researcher IDC said April 10. The slump was the steepest since IDC began tracking quarterly shipments in 1994, as buyers opted for smartphones and tablet computers and Microsoft’s newest operating system met with weak demand.

In Japan, “PC shipments were in line with expectations in the first quarter,” as some economic improvement helps support commercial replacement demand, IDC said in the statement.

To contact the reporters on this story: Naoko Fujimura in Tokyo at nfujimura@bloomberg.net; Takashi Amano in Tokyo at tamano6@bloomberg.net

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.