The weather is not looking up for those working at NEC, as a revised financial forecast for FY 2011 was recently released, where their executives’ crystal balls predicted an annual $1.3 billion loss. This would mean it is the company’s third loss for a quarter in the past four years, and in order to avert further bleeding of their coffers, NEC has announced that they will take the painful decision of making around 10,000 folks redundant in their current positions. Bloomberg Businessweek reported that President Nobuhiro Endo announced the cuts, where the majority of the cuts will affect NEC’s mobile phone handset business, and around 7,000 of them are said to lose their jobs in Japan alone.
NEC’s handsets have not really done that well actually, and seem consigned to the domestic Japanese market most of the time. I remember in the early years of mobile phones, NEC still had a decent foot in the market, although they were more of followers than breaking new ground. Shareholders will also be affected by the dismal forecast, as NEC has announced that there will not be any year-end dividend payout. Bummer!