Japan's NEC today became the latest technology group to issue a profit warning as last year's optimism fades in the face of a slowing US economy.
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NEC is the world's third-biggest chipmaker and Japan's largest supplier of PCs. It said profit for the year to March 31st would be $1.64 billion or 24 per cent below its previous estimate in October.
The news was of little surprise to the market which has been braced for bad news from Japan's big electronics makers since signs began emerging of a US slowdown late last year.
Many analysts are hopeful that a turnaround awaits in the second half of this year.
"The outlook isn't particularly bad," said Mr Akira Minamikawa, technology analyst at WestLB Securities. "For PCs we should see further adjustment in January-March, some initial orders in April-June and a resurgence in July-September."
"Regarding semiconductors and PCs, we're not optimistic about the first quarter of the next business year," NEC'S vice president Mr Shigeo Matsumoto told a news conference.
Even in liquid crystal displays (LCDs), a technological forte of Japan's big electronics makers, NEC's profits were eroded by heightened competition in the low end of the market from Taiwanese and South Korean manufacturers.