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Fujitsu Reports Fiscal 2010 First-Quarter Financial Results

- Improved profitability leads to upward projections for first half -

Fujitsu Limited

Tokyo, July 29, 2010

Fujitsu, a leading provider of ICT-based business solutions for the global marketplace, today reported consolidated net income of 1.6 billion yen (US$18 million*) for the first quarter of fiscal 2010 (April 1 – June 30, 2010), rebounding from a net loss in the previous year's first quarter, and raised its income projections for the first half of the year ending September 30, 2010.

First-quarter consolidated net sales totaled 1,047.2 billion yen (US$11,900 million), an increase of 0.3% from the first quarter of fiscal 2009. Operating income totaled 10.0 billion yen (US$114 million), compared to a loss of 37.1 billion yen in the first quarter of fiscal 2009, as all three of the company's main business segments—Technology Solutions, Ubiquitous Solutions, and Device Solutions—delivered profits in the quarter.

The Technology Solutions business, comprising services and system platforms, posted a profit surge from buoyant sales of network products for telecommunication carriers' wireless services expansion, along with lower pension costs. The Device Solutions business, comprised of LSI devices and electronic components, rebounded strongly to a quarterly profit as a result of structural business reforms and a double-digit improvement in sales.

Sales in Japan increased by 3.4%, as demand for PCs, car audio and navigation systems, LSI devices, electronic components, and network products all increased. Sales outside Japan fell 4.5% due largely to the yen's appreciation and the divestiture of the hard disk drive business in the previous year. Outside Japan, sales increased for hardware products such as LSI devices, electronic components, car audio and navigation systems, and optical transmission systems.

For the first half ending September 30, 2010, Fujitsu revised its income targets higher. Though the company now projects net sales of 2,180.0 billion yen, down 20.0 billion yen from the previous forecast due mainly to the yen's appreciation, operating income is now projected at 35.0 billion yen and net income at 15.0 billion yen, an improvement of 10.0 billion yen, respectively.

“2010 is an important year in Fujitsu's medium-term management plan geared for growth, and I'm pleased to say that we're off to a solid start," said Masami Yamamoto, president of Fujitsu. “I'm confident that the new investments we're making in global expansion and the development of cloud computing and other services will contribute to the success of our customers and drive further improvements in our financial performance."

Business Segment Results

For the first quarter, consolidated net sales in the Technology Solutions segment declined 1.0% to 665.7 billion yen (US$7,565 million). Sales in Japan were on par with the previous year, as revenue growth in system platforms, especially network products, was offset by a decline in services sales. Sales outside Japan declined 2.8%. Excluding the impact of exchange rate fluctuations, sales increased 5% outside Japan as a result of higher demand for optical transmission systems in the US and the expansion of the infrastructure services business in Oceania. The segment posted an operating income of 8.5 billion yen (US$97 million), an increase of 19.9 billion yen over the same period last year due mainly to reductions in expenses.

Net sales in the Ubiquitous Solutions were 276.8 billion yen (US$3,145 million), an increase of 8.9%. Sales in Japan increased by 12.9%, as PC sales rose on demand for new models with an upgraded OS. Outside Japan, sales declined by 2.3% but rose 6% on a local currency basis. Sales of car audio and navigation systems increased in Oceania and Asia. Operating income was 10.6 billion yen (US$120 million), a decrease of 1.1 billion yen, due mainly to lower PC prices and a shift towards more moderately priced mobile phones in Japan.second quarter.

Net sales in Device Solutions were 158.5 billion yen (US$1,801 million), an increase of 22.4% compared to the first quarter of fiscal 2009. Sales increased by 12.1% in Japan and 36.5% outside Japan as a result of higher sales of both LSI devices and electronic components. The segment posted an operating income of 6.0 billion yen (US$68 million), up 22.1 billion yen from the same period in the previous year.

Fiscal 2010 Consolidated Projections

The company's current earnings projections for fiscal 2010 are presented below.

(Billion Yen)
  First Half Full Year
  FY 2009
(Actual)
FY 2010
(Forecast)
Change FY 2009
(Actual)
FY 2010
(Forecast)
Change
Net Sales 2,186.6 2,180.0 -6.6 4,679.5 4,800.0 120.4
Operating Income -18.2 35.0 53.2 94.3 185.0 90.6
Net Income 43.2 15.0 -28.2 93.0 95.0 1.9

Complete information on Fujitsu's financial results, including financial tables, explanation of results and supplementary information, may be found at:http://www.fujitsu.com/about/ir/

* All yen figures have been converted to U.S. dollars for convenience only at a uniform rate of US$1 = 88 yen, the approximate closing rate on June 30, 2010.

Note: These materials may contain forward-looking statements that are based on management's current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Actual results may differ materially from those projected or implied in the forward-looking statements due to, without limitation, the following factors:
- General economic and market conditions in key markets (particularly in Japan, North America, Europe, and Asia, including China)
- Rapid changes in the high-technology market (particularly semiconductors, PCs, etc.)
- Fluctuations in exchange rates or interest rates
- Fluctuations in capital markets
- Intensifying price competition
- Changes in market positioning due to competition in R&D
- Changes in the environment for the procurement of parts and components
- Changes in competitive relationships relating to collaborations, alliances and technical provisions
- Risks related to product or services defects
- Potential emergence of unprofitable projects
- Risks related to R&D investments, capital expenditures, business acquisitions, business restructuring, etc.
- Risks related to natural disasters and unforeseen events
- Changes in accounting policies

About Fujitsu

Fujitsu is a leading provider of ICT-based business solutions for the global marketplace. With approximately 170,000 employees supporting customers in 70 countries, Fujitsu combines a worldwide corps of systems and services experts with highly reliable computing and communications products and advanced microelectronics to deliver added value to customers. Headquartered in Tokyo, Fujitsu Limited (TSE:6702) reported consolidated revenues of 4.6 trillion yen (US$50 billion) for the fiscal year ended March 31, 2010. For more information, please see: www.fujitsu.com.

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All other company or product names mentioned herein are trademarks or registered trademarks of their respective owners. Information provided in this press release is accurate at time of publication and is subject to change without advance notice.

This press release has been revised as of December 17, 2018.

Date: 29 July, 2010
City: Tokyo
Company: Fujitsu Limited, , , , ,

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