Just in time for CES, consumer electronics giant Toshiba announced another wave of layoffs. This time, the company plans to axe 6,800 jobs in the consumer electronics business. It represents around 30 percent of the consumer electronics division, or 3 percent of Toshiba’s workforce. In addition to these cuts, 1,000 people in the corporate staff will also lose their job as part of an effort to slim down the company.
Toshiba is also selling a plant manufacturing TVs in Indonesia and is looking for a buyer or investor for its health device division. It is working on dismantling Fukushima’s nuclear power plant as well following the March 2011 tsunami.
The company also forecast a record $4.5 billion loss (550 billion yen) for the current fiscal year. This has been a very dark year for the company for a simple reason — an accounting scandal. Ever since the 2008 financial crisis, a few divisions cooked the books over multiple years.
When the scandal broke in July 2015, multiple executives resigned, and the company announced a stark $1.2 billion correction (152 billion yen). The company is still recovering from the scandal.
But that doesn’t explain the $4.5 billion loss. It turns out Toshiba has deeper problems. The company isn’t in great shape at all, especially when it comes to consumer laptops and TVs.
It has become incredibly difficult to generate a profit with a television business due to Korean and Chinese competitors. As for laptops, the PC market has been falling, and Toshiba is just another OEM with very few differentiating factors.
That’s why the company announced that it would focus on selling laptops to big companies. Toshiba will still sell consumer laptops in Japan and the U.S., but will disappear from your favorite consumer electronics stores in the rest of the world.