Toshiba CEO: Yeah, we MAY need to chop some heads
Accounting scandal and declining PC sales hit Japanese corp
Toshiba is looking to take “urgent action” across its PC and TV business that may well involve cutting jobs, according to the chief executive.
The scandal-hit Japanese corporation last month reported declining sales and widening losses in its Lifestyle Products and Services division that houses clients devices.
This followed an accountancy debacle that emerged in July when Toshiba admitted it had inflated profits to the tune of $1.2bn since the global financial crisis.
“The latest accounting problems might have been driven by the fact that some of our businesses have lost earning power,” CEO Masashi Muromachi told Reuters.
The exec, who was made interim boss several months ago, added “We must urgently take action in these businesses”.
The management team in Europe was overhauled at the start of last year with former European veep for the PC and TV business, Andy Bass, exiting amid a move to scrap EU country managers. Bass was followed out the door some nine month later by president Alan Thompson, who retired.
The general workforce was scaled back in the region as sales slumped, and back office roles chopped as the UK and France ops were converted into sales and smaller marketing satellite offices.
The PC market is in the doldrums and isn’t forecast to improve this year, remain flat next and lift in 2017.
According to Canalys, Toshiba sold just over two million PCs worldwide in Q2 giving it a market share of two per cent, meaning it shipped fewer than half the boxes Acer managed.
Tim Coulling, senior analyst, told us Toshiba was exposed to inventory issues, particularly in the consumer space, and the weak Yen didn’t help either. “We saw Sony bail out of the market, and [similarly] Toshiba can’t compete with Apple at the high-end, or at the low-end with Acer," he added.
We asked Toshiba to comment but it has pushed the request onto head office in Japan.
Updated A Toshiba spokeswoman sent us this statement:
"Toshiba will have to consider unconstrained, bold reforms of unprofitable businesses to rebuild Toshiba Group, however, no additional restructuring plans are decided other than the ones already made public." ®