Sharp To Build Displays For Samsung, Aiming To Recover From $5.4 Billion Loss
Sharp Corp, one of the largest display makers from Japan and a supplier to Apple, has signed an agreement with Samsung to supply small display screens for mobile phones, aiming to recover from a worse-than-expected $5.4 billion net loss in its latest financial year, Reuters reports. The business plan, which is a part of a three-year rehabilitation roadmap, will target annual operating profit of 150 billion yen by the year to March 2016.
Helped by expanded screen shipments to the Korean tech giant, Sharp forecasts an 80 billion yen operating profit for the year to next March 31. However, the biggest challenge for Sharp’s recovery is keeping the factories busy enough to earn profits that will satisfy its creditors “despite slowing growth in its business making screens for Apple’s iPads and iPhones”, notes the source.
“In January, Sharp had to curtail production of 9.7-inch iPad screens, hurting output levels and threatening its recovery in profitability. The Japanese company is preparing to begin large-scale production next month of screens for Apple’s next iPhone model, the sources said.
In a March agreement with Samsung Electronics that provided cash-strapped Sharp 10.4 billion yen in capital in return for a 3 percent stake, Japan’s leading liquid crystal display fabricator also promised to supply small display screens to the world’s biggest maker of mobile phones.”
While Hon Hai and Sharp have decided to remain in contact, cooperation for now is limited to their shared ownership of the world’s most advanced LCD plant in Sakai, Japan.