Fujitsu's business outlook brightens

Fujitsu has raised its first-half financial outlook on strong demand for several key products.

Healthy demand for cellular equipment and other key products should help Fujitsu achieve better than expected financial results in the first six months of its fiscal year, it said Wednesday.

The Tokyo company, which is due to report first quarter earnings on Thursday, said it expects to lose YEN 15 billion (AU$175.6 million) on a company-wide basis in the period from April to September. That's half as much as it had previously forecast it would lose. Its net sales forecast for the period remained unchanged, at YEN 2.2 trillion.

While the recovery in IT spending in Japan has been "patchy at best" and investment has yet to return to levels previously seen, several of Fujitsu's businesses are experiencing strong demand, the company said in a statement. They include sales of cell phone-related equipment in Japan, optical transmission systems in North America, and hard-disk drives, it said.

Those factors, plus gains expected from the weaker Japanese yen and the settlement of litigation relating to hard-disk drives, led to the revisions, it said.

Despite the brighter outlook, the loss would still be bigger than Fujitsu reported during the April to September period of 2004, when its net loss was YEN 8.1 billion and net sales were YEN 2.22 trillion.

The company did not change its full-year forecast, which calls for a net profit of YEN 50 billion and net sales of YEN 4.85 trillion, up 57 percent and 2 percent on last year, respectively. It cited an expected delay in the recovery of the semiconductor market and other unspecified uncertainties in the second half as reason for not changing the full-year outlook.

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Martyn Williams

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