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NEC in Wham Bam to DRAM

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NEC Corp today reported profit up five-fold for the year, but said it would axe most of its DRAM production.

Group net income grew to $463m on sales up 8.4 per cent to around $44bn for the year to March 31.

But the company had a hard time in the second half of the year in the chip, PC and LCD markets. NEC said it had decided to end all DRAM production except in its Hiroshima plant, which makes DRAM for Elpida Memory.

Plants in Scotland and California will switch efforts to higher margin large-scale integration (LSI) chips. Earlier this month the company warned it would lay off around 700 staff at its California plant and move away from DRAM production.

NEC also plans to ditch LCD production for notebooks, and will instead push efforts into either making smaller panels for mobile phones or larger panels for high-resolution monitors. It will outsource notebook LCD manufacturing to Taiwan's Chi Mei Optoelectronics Corp.

And it aims to sell its laser printing business to Fuji Xerox, and hopes to have this part of the company shifted by August.

But it is not planning to abandon its PC business - it aims to save cash by merging four divisions involved in PC development and manufacturing into a new company called DMS (Design Engineering, Manufacturing and Service). ®

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