TOKYO -- Toshiba on Wednesday slashed its operating profit forecast for fiscal 2018 by 66% to 20 billion yen ($181 million), barely three months after forecasting 60 billion yen for the year.
The cut came as the group reported a 94% plunge in operating profit for the third quarter to 1 billion yen, on a 6% drop in revenue. Rising costs in its energy business and a 9.8 billion yen goodwill impairment to semiconductor equipment subsidiary NuFlare Technology -- stemming from a sharp decline in share price -- accounted for the drop in earnings and the revised forecast, the group said.
The industrial conglomerate has been working to put its financial troubles behind it with plans to invest in new fields like the "internet of things." But it continues to struggle to find a way forward without Toshiba Memory, the crown jewel semiconductor business it was forced to sell last year.
"The downgraded forecast is the result of one-time costs and making allowances early on for potential risks," Chief Financial Officer Masayoshi Hirata said at an earnings briefing in Tokyo on Wednesday.
The sale of the chip business also means that it is no longer included in earnings on an operating basis. As part of the deal, Toshiba reinvested for a stake in the business, so it is an equity-method affiliate and remains part of net results. read the rest here