Fujitsu exits HDD business, sinks deeper in red

Japan's Fujitsu Ltd. said Tuesday it would transfer its struggling hard disk drive business to rival Toshiba Corp., a deal that will push it deeper into loss this year than previously expected.
Fujitsu forecast a net loss of 50 billion yen (555 million dollars) for the year to March, more than double the 20 billion yen loss it had estimated last month, due to the divestment of the HDD business.
The company left unchanged its forecasts for operating profit of 50 billion yen and revenue at 4.7 trillion yen.
Fujitsu said it would hive off its HDD business into a new firm, which Toshiba will turn into a subsidiary with a stake of 80 percent. Fujitsu will hold 20 percent. Financial terms of the deal were not disclosed.
The transfer "will enable Toshiba to reinforce its already strong position as a leading vendor of small form factor HDDs, widely used in notebook PCs, mobile devices, automotive and consumer electronics," the statement said.