A brutal week for the technology sector was rounded off by South Korea’s Samsung posting its first ever quarterly loss.
The world’s top maker of memory chips, flat screen televisions and liquid crystal displays has – like its rivals LG and Panasonic – been hit by tumbling prices and plunging consumer demand. Sony too is taking a beating: this week it forecast an annual net loss from slumping sales, the strong yen and restructuring costs. Sony’s boss, Howard Stringer, said predictions three months ago were way too optimistic: “We are in the worst economic depression in my lifetime, economic recession – we’re not supposed to call it a depression, but it feels pretty depressing. Whereas we were anticipating a high profit in October, we’ve obviously lost a lot.” The top names under pressure include Microsoft, the world’s biggest software make. It shocked Wall Street with poor quarterly results, a profit warning and plans to slash up to 5,000 jobs which sent its shares to an 11-year low. The latest to succumb is German chipmaker Qimonda, part of Infineon Technologies, which has just filed for bankruptcy, while chipmaker Intel said it is to cut 6,000 jobs. In Finland, the number one mobile phone maker Nokia this week reported a worse-than-expected dive in fourth-quarter profit and warned the handset market had entered its worst year ever. However amid the gloom, investors were relieved that internet search engine Google’s revenue grew 18 percent year-on-year; analysts said that was strong for the current climate.