10,000 job cuts at NEC after announcement of financial loss

10,000 job cuts at NEC after announcement of financial loss

 

 

 

According to foreign media reports, the NEC company expected by the on Thursday the third consecutive year the performance will be a loss and announced 10,000 job cuts the impact of the news, the company Tokyo Stock Exchange, shares fall 7.1% on Friday, 10-month decline since a new high.
NEC shares Friday in regular trading on the Tokyo Stock Exchange fell 7.1 percent, to close at 156 yen. The company’s stock price decline on Friday was reached 8.9%. Friday, the Nikkei 225 index rose 0.4 percent, among all the constituent stocks, NEC shares fell the most. As consumers have chosen to buy Apple’s iPhone and Samsung’s Galaxy smart phones, resulting in NEC mobile phone unit shipments greatly reduced, the department will no doubt be the hardest hit NEC round of layoffs. NEC is expected on Thursday, March 31, ended the 2012 fiscal year, net loss will reach 100 billion yen ($ 1.3 billion). NEC had previously forecast, the company net profit this fiscal year will reach $ 15 billion.

Deutsche Bank analyst Takeo Miyamoto said, “NEC’s restructuring plan seems to lack of business strategy is easy to see from a layoff, NEC list management is just a number of layoffs, but did not seriously think about what should be retained, what should be cut Investment people are not expected to improve the performance of NEC. “The analyst report gave investors stock NEC” hold “rating.

NEC said in a statement on Thursday that the spending cuts will be 40 billion yen, the company will no longer be in a year dividend to shareholders. NEC’s products currently include mobile phones, computers and wireless devices.NEC said the layoffs will begin March 31, affected employees will account for about 8.6% of the total number of employees. The job cuts will be divided into two full-time and part-time departments. NEC also said that about 7,000 employees in Japan will be subject to layoffs, mainly concentrated in the mobile phone unit.
Massive layoffs
Bloomberg statistics show that as of March 31, 2011, NEC’s global workforce of 115,840. NEC goes back to the last round of layoffs in 2009, when the company announced it would cut more than 2 million people, the vast majority concentrated in the semiconductor and electronic components sectors. NEC president Endo (Nobuhiro Endo) said on Thursday that Europe and the developing countries because of macroeconomic concerns, the company has decided to “limited resources” into one of the few businesses which.
In the past 12 months, NEC has lost 37% of the market, the Nikkei 225 index over the same period a decrease of 15%. NEC announced the results, as of December 31 of the third quarter, the company net loss of 86.5 billion yen, worse than a year earlier net loss of 26.5 billion yen; revenue fell 6.7%, down672 billion yen.
Apple and Samsung
Samsung Electronics reported a release Friday, the company’s fourth quarter net profit rose 17%, up to 4 trillion won ($ 3.6 billion). Apple’s earnings report released earlier this week showed, by the iPhone worldwide sales reached 37 million, driven company posted net profit of $ 13.1 billion, compared with same period last year more than doubled.
Mizuho Investors Securities analyst Yuichi Ishida said, “NEC to demonstrate how to enhance the company’s performance. It is not clear how NEC mobile phone, computer and automotive battery business of the medium-term goals.” The analyst report to give investors NEC’s stock “neutral” rating.

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