Business

Mon Jul 28 23:53:01 PDT 2008

TOKYO, July 29 (Reuters) – Japanese electronics maker Toshiba Corp swung to a quarterly operating loss as a rapid fall in chip prices dented sales, but it kept its annual outlook above market expectations.

The world’s No. 2 maker of NAND flash memory chips behind South Korea’s Samsung Electronics Co Ltd said on Tuesday it fell to an operating loss of 24.18 billion yen ($225 million) in April-June against an operating profit of 21.18 billion yen in the same period the previous year.

Faster-than-expected price falls in NAND flash memory chips and a slump in system chip operations purchased from Sony Corp are hurting profitability at Toshiba, just as it plans to ramp up capacity in a bid to take more market share.

Toshiba, which last week announced plans to sell off its real estate unit, kept its forecast for an operating profit of 290 billion yen, which is above the consensus estimate of 274 billion yen by 15 analysts polled by Reuters Estimates.

Shares of Toshiba lost 29 percent from a peak in early June through Monday’s close as the price of NAND, used in digital cameras and mobile phones, fell. The Tokyo bourse’s electrical machinery index IELEC.shed 13 percent in the same period.

(Reporting by Mayumi Negishi; Editing by Lincoln Feast)

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