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Panasonic officially quits the consumer smartphone business, president says mobile performance was 'unacceptable'
As reported in the Nikkei, Panasonic will today pull out of smartphone market in Japan, and change to outsourced production (offering its brand to other manufacturers) in emerging markets like India. Company president, Kazuhiro Tsuga, has set strict guidelines to turnaround the company, threatening any division that missed a 5 percent operating margin goal within three years. The mobile arm is forecast to lose more than 1.1 billion yen ($11 million) for the incoming fiscal year -- losses were 8.1 billion yen ($81 million) the year before. It joins NEC, which also dropped its smartphone arm in July. Times are tough everywhere. "It's not acceptable for the company to be bleeding red ink like this, so we have to think about ways to develop assets that we do have in a more effective direction", Tsuga said. Panasonic is not stopping completely with phones, however, and plans to expand on its Toughbook laptop series with smartphones for rough-and-tough business use. Panasonic attempted to break back into the western phone market in 2011, launching the water-resistant Eluga but failed to pick up any carrier support in Europe or the US. According to Reuters, Panasonic was once the second-largest phone maker in Japan, and had over 19 percent of the market in 2001. Last year, this dropped to seven percent -- far behind the iPhone's 24 percent pole-position. This year, Japan's biggest carrier (and currently one of the only major carriers in the world not selling the iPhone) NTT DoCoMo, said it would be promoting only Sony's Xperia A and Samsung's Galaxy S4 during its "Top Two" summer advertising. At least now, Tsuga-san will have more time to plug those premature TV leaks.
Panasonic's restructuring plan will let it keep making TVs, for now
After rumors swirled that Panasonic was considering putting a stop to production of its well-regarded plasma HDTVs later this year, the company announced it will stay in the business. President Kazuhiro Tsuga revealed a three year growth plan for Panasonic to focus on batteries and entertainment systems for cars, as well as environmentally friendly housing developments. It will also streamline the number of departments by allowing each division to handle its own products from development to release. The beleaguered TV unit will stay, as Tsuga said it will consider walking away only as a last resort. Additionally, Chairman and former CEO Fumio Ohtsubo will retire in June. Some analysts believe Panasonic will still need to lay off workers if it's to turn things around, but we'll have to wait and see how Tsuga's plan comes together.
Panasonic shows $613 million operating profit for Q2, but lowers full year projections
The good news for Panasonic in its Q2 earnings release is that it managed to record a 48.8 billion yen ($613 million) operating profit, higher than last year. The bad news however is word of falling sales in its TV business, although we're not hearing any confirmation of changes in its plans for mobile phones. New CEO Kazuhiro Tsuga is working a new restructuring plan that should help return divisions like its one for TV to profitability, but there will be costs upfront. The company revised its operating profit prediction for the year to 140 billion yen ($1.76 billion) based on the slower sales, and still is looking at a net loss for the year of 765 billion yen ($9.6 billion) due to deferred tax assets. Hopefully any cost-cutting doesn't affect the quality of its Viera HDTV brand, but Panasonic will have to figure out some way to turn those stellar reviews into overall profits, even as the market continues to shrink. Our suggestion? Get some of those 8K Super Hi-Vision plasmas to market, ASAP.
Panasonic names Kazuhiro Tsuga as new president after old one loses $9 billion
In the aftermath of company losses that passed $9 billion, Panasonic has announced that Fumio Ohtsubo is to step down as company president. He'll be replaced by current senior executive Kazuhiro Tsuga in an executive reshuffle that'll take place in June, when Ohtsubo will step up to become chairman of the board, replacing Kunio Nakamura who is taking an "advisory role." Tsuga was formerly an exec. at Matsushita (before it was renamed... Panasonic. Confusing, we know), where he spent a lot of time thumbing his nose at HD DVD and promising that Blu-Ray would win the last format war -- so we know his instincts are at least halfway decent.