Falling prices squash Fujitsu profits

Fujitsu has issued a profit warning in the face of falling PC prices and disappointing mobile phone sales. The Japanese vendor warned that it may fall short of both its profit and sales forecasts for the financial year ending this month. "Our hardware equipment did not sell in Japan and overseas as much as we expected," said a Fujitsu representative. Fujitsu's semiconductor business had performed well and Fujitsu expects it to continue to do so. But the company's sales of communications equipment in North America were less than expected, while mobile sales were damaged by a parts shortage, Bloomberg reported. "Japanese makers including Fujitsu and Hitachi will continue to be in a tough fight with IBM in the international computer market," said Masashi Ichikawa, an analyst at Kokusai Securities. Fujitsu did not disclose how big the pre-tax profit shortfall would be, but Takashi Mimura, a Societe Generale analyst believed it could be as high as 50 billion yen. In October, the vendor predicted consolidated earnings for the year of Y60 billion (£354 million) on sales of 5.5 trillion yen. Pre-tax profit was forecast at Y140 billion. The company said it would continue to pump money and management resources into "Internet-related businesses". ®