(AFP) – Mar 12, 2008
TOKYO (AFP) — Japan's Toshiba expects to post nearly one billion dollars in losses this year as it shuts down its HD DVD business after losing to rival Sony's Blu-ray format, a newspaper said Thursday.
Toshiba Corp. is expected to see total HD DVD losses balloon to as much as 100 billion yen (985.61 million dollars), the Nikkei business daily said, without identifying its sources.
Toshiba declined to confirm specific figures.
"The company is currently assessing the possible losses," a Toshiba spokeswoman said. "If we need to revise an earnings report, we will make an announcement at an appropriate time."
Toshiba conceded defeat last month in a long-running DVD format war, clearing the way for the Blu-ray format developed by Sony and its partners to become the industry standard for next-generation discs.
Toshiba, which will stop selling its HD DVD machines by the end of March, is likely to rack up 50 billion yen in losses alone to shut down the business, the Nikkei said.
It said the company would also sustain similar losses for related fallout from DVDs, including poor sales of HD DVD and money put into advertising campaigns, the Nikkei said.
The electronics conglomerate will likely see its group operating profits come to about 250 billion yen, some 14 percent shy of an initial forecast for 290 billion yen, it said.
Toshiba, which owns US nuclear plant maker Westinghouse, has seen gains in the power and home appliance businesses and reported an operating profit of 258.4 billion yen last year.
Blu-ray and HD DVD both offer cinematic-quality images and multimedia features, but the movie studios were eager to see the emergence of just one standard.
Many consumers had also been reluctant to buy a machine that might be overtaken by a market leader.
HD DVD's fate was sealed by a series of heavy setbacks, with Hollywood titan Warner Brothers and US retail giant Wal-Mart both throwing their weight behind Blu-ray.
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