Toshiba To Consolidate Operations, Cut 6 Per Cent Of Jobs In Japan After Delisting

TOKYO, May 17 (Bernama-Kyodo) -- Toshiba Corp announced on Thursday that it will reduce up to 6 per cent of its workforce in Japan by offering early retirement packages and integrating key subsidiaries.

This major revamp aims to turn its business around after going private late last year, Kyodo news agency reported.

"This is a necessary thing to do to ensure the company survives for the next 100 years," President Taro Shimada said at a press conference in Tokyo, revealing the medium-term business plan that includes shedding 4,000 jobs.

The early retirement plan targets domestic employees aged 50 and over, primarily in back-office departments. The company plans to complete the job cuts by the end of November to reduce labor costs.

"It was an agonising decision to make," Shimada added.

Toshiba will focus its resources on growth areas such as power semiconductors for electric vehicles, artificial intelligence products, renewable energy equipment, and quantum technology.

In another streamlining effort, Toshiba will integrate four main subsidiaries operating in sectors like energy and infrastructure.

To increase efficiency, Toshiba will consolidate its headquarters functions from Tokyo’s Minato Ward to Kawasaki in Kanagawa Prefecture, instead of maintaining two head offices.

Toshiba's delisting in December followed a 2 trillion yen ($13 billion) buyout by a consortium led by Japan Industrial Partners Inc. This move allows Toshiba executives to focus on management and make quick decisions without interference from activist shareholders.

"We put 100 per cent into coming up with this plan so that we can realise the best version of Toshiba. We will put the company back on a growth track," Shimada said.

Toshiba reported a net loss of 74.8 billion yen for fiscal 2023, a reversal from a net profit of 126.6 billion yen the previous year. Sales fell 2 percent to 3.29 trillion yen, while operating profit dropped 64 percent to 39.9 billion yen.

Under its medium-term business plan, Toshiba aims to increase its operating profit to 380 billion yen by fiscal 2026, with a goal to raise its operating margin to 10 per cent from 1.2 per cent in fiscal 2023.

-- BERNAMA-KYODO