Japan's Hitachi Ltd posted a 48 percent fall in quarterly profit on Monday, hurt by its loss-making hard-disk-drive operations, and it cut its full-year forecast more than expected, sending its shares lower.
Hitachi's hard disk drive unit, bought from International Business Machines Corp in 2002 for $2.05 billion, has been in the red in recent years due to low production yields and competition from the likes of US-based Seagate Technology
Apple Computer Inc's shift to a NAND flash-based iPod nano from the hard-disk-based iPod mini was another blow to Hitachi, which supplied matchbook-sized 1-inch disk drives for the iPod mini.
Hitachi, Japan's largest electronics conglomerate, cut its group net profit forecast for the year to March 2006 by nearly two-thirds to 20 billion yen ($170 million).
The new target is down from a 51.5 billion yen profit last year and sharply below the consensus forecast of 45.22 billion yen in a poll of 16 analysts by Reuters Estimates.
Hitachi's results were also dented by struggling plasma and liquid crystal display operations, which were hit by steep price declines.
Hitachi increased its exposure to highly competitive flat-panel businesses earlier this year by boosting its stake in a plasma display venture with Fujitsu Ltd.