Toshiba America Information Systems plans to lay off 56 workers at its Irvine, Calif., headquarters on Nov. 5. The layoffs in some ways aren’t surprising following Toshiba Corp.'s weaker than expected performance in its fiscal first quarter and widening losses in its PC and television businesses.
During the quarter that ended in June, Toshiba's personal computers and television businesses took a hit. The digital products segment, which sells PCs, and its visual products division, which includes TVs, posted a 1 percent revenue drop to 334.5 billion yen in the quarter, compared with a year ago. The operating loss soared to 16.3 billion yen in the quarter, a five-fold increase from the previous year. Toshiba America Information Systems (TAIS), an independent operating company of Toshiba America, runs a digital products division, which includes laptops, netbooks and PC accessories, as well as a visual products division for TVs. "Even though the visual products business, which includes LCD TVs, is on a path for recovery in Japan, it also recorded a decrease on slumping sales in the United States and Europe," the company said in its earnings release. "The PC business saw sales drop and reduced sales volume, reflecting a shift in demand to smartphones and tablets." Toshiba's new president, Hisao Tanaka, is currently reorganizing the corporation's money-losing TV and PC operations, a Bloomberg report notes. Instead, Tanaka wants the company to focus on semiconductors and energy.