Sharp shares jump on profit forecast after Foxconn deal
Japan electronics maker says restructuring under new owner Foxconn will boost profit
Japan’s Sharp Corp said it expected significant improvement in annual profit on restructuring and synergies with new owner Foxconn, sending shares in the display maker soaring 10 percent.
The statement by Sharp comes after the Nikkei business daily reported it expects an operating profit of about 40 billion yen ($385 million) this financial year, much bigger than a consensus of 6.6 billion yen in a Thomson Reuters I/B/E/S poll of 11 analysts.
That would mark the first return to the black at the operating level in three years for Sharp, which is rebuilding under Foxconn. The Taiwanese company, formally known as Hon Hai Precision Industry Co., took a two-thirds stake in Sharp in August.
Sharp said, however, that while profits were expected to improve, revenue was likely to drop.
The company said it plans to provide a full-year forecast on Nov. 1, when it announces its second-quarter results.