One year ago, Japanese companies were reporting their first full quarter of business following the March 2011 earthquake and tsunami. This week, two of the nation’s largest electronics companies reported strong profits for the June quarter despite declining revenue.
Panasonic Corp. (NYSE: PC) bounced back from a record loss of 772.2 billion yen in the comparable year-ago period to a net profit of 12.8 billion yen ($163 million) for the quarter ending in June. Toshiba Corp. (Tokyo: 6502) more than doubled its quarterly profit to 11.47 billion yen ($147 million) in the April-June quarter, up from 4.12 billion yen a year ago.
Both companies saw single-digit declines in revenue: Panasonic’s sales dropped by 6 percent to 1.815 trillion yen and Toshiba’s net sales declined by 4.3 percent to 1,268.9 billion yen. Both companies reported aggressive cost-cutting measures during the quarter: Panasonic slashed its global workforce by more than 30,000 jobs and Toshiba scaled back its TV business and cut its NAND memory production.
Makoto Kubo, Toshiba corporate executive vice president, said, "This quarter (April-June) we saw a particularly large decline in prices for semiconductors, NAND flash memory chips," at a news briefing reported by Reuters:
'In overall electronic devices division sales, hard disk drives and storage sales remained positive, while the strong yen and the declining prices of memory chips cut into its sales,' he said.
Toshiba's flagship NAND memory chips, the biggest single swing factor in the company's results, are used in Apple Inc.’s popular iPhones as well as fast-selling tablet devices.
Toshiba said its electronic devices division, home to the NAND chips, posted first-quarter sales of 307.7 billion yen, down nearly 8 percent on the same period last year.
Both companies echoed concerns expressed by other electronic companies, including distributor Arrow Electronics Inc. (NYSE: ARW), that the industry faces "no to slow" growth in the upcoming quarter. Arrow executives reported orders were being delayed, rather than cancelled. "It’s being pushed out," said CEO Mike Long, "but it’s not gone." Arrow’s second-quarter sales of $5.15 billion declined 7 percent from sales of $5.54 billion in the prior year.
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Thailand Stages a Comeback Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
While no one really can accurately predict the future, we can take guidance from another Drucker saying which is the best way to predict the future is to create it.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.