Technology and IT services giant Fujitsu fell into the red in its first fiscal quarter on the back of increased costs in its chip business and accounting changes.
In the three months ending June 30, 2007, the Tokyo-based company made a net loss of JPY 14.8bn ($123m) compared to a gain of JPY 664m ($5.5m) in the year-ago quarter, with operating profit down 80% at JPY 2.9bn ($24m).
Fujitsu blamed a change in accounting policy as well as sluggish sales of standard technology logic products, and also pointed to a JPY 13.5bn ($112m) increase in selling, general, and administrative expenses created by the growth of its services business in Europe and higher development costs in telecoms networks and chips.
Revenue increased 5.8% to JPY 1.17trn ($9.7bn), with all of its four main operating units increasing revenue by at least 5%. Technology Solutions, the unit which pools together its enterprise server and IT services activities, posted a 5.2% rise in sales to JPY 683bn ($5.7bn), with the services arm reporting a 10.9% rise in revenue to JPY 543bn ($4.5bn) and an 85% improvement in operating profit to JPY 15bn ($125m).
The Ubiquitous Product Solutions division made an 8.8% increase in first-quarter sales to JPY 275bn ($2.3bn), which included a 14.2% rise in sales of PCs and mobile phones which was slightly offset by a 2.9% fall in sales of hard disk drives.