Japan's Renesas logs $1.73 bn loss, cuts forecast

Struggling Japanese chipmaker Renesas Electronics on Friday posted a $1.73 billion net loss in the nine months to December, and chopped its annual earnings forecast by 17 percent. The company, a major supplier of microcontrollers used in automobiles, said it lost 161.72 billion yen ($1.73 billion) over the period, widening from a 44.42 billion yen loss in the same period in 2011. Revenue fell 10.8 percent to 600.4 billion yen, it said. Renesas also said it now expected a 176 billion yen net loss for the fiscal year to March, worse than an earlier 150 billion yen estimate, on sales of 770 billion yen, a cut from a previous 820 billion yen outlook. Sagging global demand for semiconductors hurt sales, it said. "In addition, a production decrease of automotive, electronic and other equipment in China also had a further impact on demand for semiconductors through the period," it said in a statement. Renesas plans to widen an early retirement scheme as it scrambles to cut costs to shore up its bleeding balance sheet. The company said last month it had proposed to its labour union that more than 3,000 jobs be added to an existing plan to slash 11,500 positions through voluntary reductions and factory floor cuts. Japan's microchip sector has struggled with a strong yen and fierce competition, especially from South Korean and Taiwanese rivals. Renesas last year said it would raise more than $2.0 billion from a share sale and a separate capital injection. The deal calls for Renesas to sell shares to the state-linked Innovation Network Corp. of Japan (INCJ) and top corporate names including Toyota and Panasonic. Renesas shares closed down 3.05 percent at 286 yen on Friday, with the company's results published after markets closed.