NEC to Reorganize Operations

NEC Corp., Japan’s largest maker of personal computers and microchips, said it will strengthen its Internet service business and reorganize operations in a bid to recover from a record loss of $1.5 billion in its last fiscal year ended March 31.

The company also said it now expects net profit of about $94 million for its current fiscal year, 60% lower than its previous forecast, because of sluggish domestic demand for telecommunications equipment and weaker-than-expected prices for microchips in the April-June period.

NEC expects total sales of about $47 billion, marginally lower than its earlier expectations but 5% above those of the previous year.

Under its reorganization plan, NEC said it will split its unprofitable NEC Home Electronics into four units. Early next year, it will form three in-house companies that will have greater independence over the budget and management of the company’s three main business areas--computers, microchips and telecommunications equipment.