TOKYO – Japan's Toshiba Corp <6502.T> cut its full-year group operating profit forecast to 260.00 billion yen ($3.27 billion) on Wednesday from its previous outlook of 300 billion yen, saying the uncertain global economy weighed on its prospects.
The company said the continuing European debt crisis, slowdowns in China and India, and a strong yen were combining to "increase uncertainty about the future."
Still, Toshiba reported a slightly better-than-expected operating profit of 57.50 billion yen for the July-September quarter, although that was still down 23.2 percent from the same period last year. The result topped the 55.5 billion yen operating profit forecast by four analysts surveyed by Thomson Reuters I/B/E/S.
Toshiba's executive vice president, Makoto Kubo, said the company had been able to return its NAND memory chip business to a profit in July-September and for the six months to September after seeing it lose money in the April-June quarter.
The company also said in a statement, however, that the strong yen and a worsening macroeconomic environment had led to a drop in profits for its digital products, electronic devices and household electronics divisions.
Toshiba, Japan's leading chipmaker, struggled with a supply glut of its NAND memory chips earlier this year and cut back production at its main factory by 30 percent.
The company said in July it was forced to slash production due to falling prices of USBs and memory cards. Analysts say more than half of Toshiba's memory chips are destined for Apple Inc iPhones.
On Wednesday, the firm said it would continue NAND production cuts in the October-March period but by less than 30 percent.
Toshiba's biggest rival, Samsung Electronics Co Ltd <00593.KS>, forecast last week global shipments of NAND chips to grow in the mid-20 percent range in the current quarter, led by new mobile product launches.
In May, Toshiba said it aimed to more than double its annual operating profit in three years by expanding its social infrastructure business, which makes products ranging from elevators to medical systems to nuclear power plants, and boosting sales of electronic devices.
Shares of Toshiba, which competes with Hynix Semiconductor Inc <000660.KS> in semiconductors and with General Electric Co and Areva in nuclear reactors, closed up 4.59 percent ahead of the results. Tokyo's benchmark Nikkei <.N225> closed up 0.98 percent.
(Reporting by Mari Saito; Editing by Matt Driskill)