Sharp Tumbles After Net Loss Said to Reach 300 Billion Yenby
The Apple supplier is struggling in mobile device displays
Sharp says it's looking into restructuring-related losses
Sharp Corp. fell the most in almost two months on concerns that the Japanese company’s loss for the last fiscal year will be far wider than forecast.
The company may report a net loss of 300 billion yen ($2.8 billion), according to a person familiar with the matter, almost double the 161 billion yen that analysts expect on average. The stock dropped 8.5 percent to 129 yen at the close in Tokyo, its biggest fall since March 16.
Sharp has struggled for years with deteriorating demand for consumer electronics and the displays it provides mobile phone makers like Apple Inc. The Osaka-based company, which Foxconn Technology Group took control of this year in a $3.5 billion deal, had previously forecast a 170 billion yen operating loss.
“We’re not at the stage where we can disclose net losses or net assets as we’re looking into a restructuring-related loss,” Toyodo Uemura, a spokesman for Sharp, said by phone.
Sharp’s results are worsening every quarter as it sheds market share in businesses from appliances and solar equipment to flat panels for mobile devices. Foxconn, the main assembler of iPhones, hopes to reverse its fortunes by winning business from customers like Apple.
The Nikkei first reported on Sharp’s likely net loss for the year based on a slowing display business and heavy extraordinary losses, without saying how it got the information. It may have incurred losses from an inventory adjustment as part of restructuring efforts by Foxconn, the Mainichi newspaper reported previously.
Sharp’s shares slid by more than half last year, erasing 243 billion yen in market value. The company had only just revised an earlier forecast for a 10 billion operating profit for the year to a loss on March 30. If the Nikkei’s report is correct, it will bring total losses on a net basis since 2012 to more than 1.3 trillion yen.