Did Apple Trick Sharp?

Sharp is really regretting its dependence on Apple as its main customer.

While it made sense at the time to be extremely pleased when Apple sucked up most of its capacity with screens for its iPhone and iPad, now the tide has turned the outfit is reporting a bigger than forecast loss. Sharp is now suffering from low output at its factories and forced to write off excess capacity.

The company had a $5.1 billion net loss for the year which is much worse than it predicted. At the start of the year, Sharp was forced to curtail production of 9.7-inch screens for Apple’s iPad. That has stepped up the urgency for Sharp to find new customers and uses for its leading-technology displays and may make it harder for the company to convince investors and lenders it remains a viable company.

Sharp will officially announce its results for latest business year on May 14. To make matters worse the company is also taking a charge to put aside cash for possible fines from a display price-fixing investigation in Europe, the sources said. Sharp in October received a $4.4 billion bailout from banks including Mizuho Financial Group and Mitsubishi Financial Group in return for mortgaging nearly all its factories and offices in Japan and pledging to cut 10,000 jobs.

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Sharp Says No To Intel

While Sharp is desperately looking for more cash, it appears that it will try busking outside CES with a dog on a string before it takes money from Intel.

A senior senior executive from the Japanese company told the Mercury News denied that the company was looking for money from Intel. Industry analysts had speculated that Intel and Sharp, which supplies screens to Apple (AAPL) for its latest iPhonem, were in investment discussions.

Sharp is fighting for survival after years of losses. In November, it said it may not be able to survive on its own after full-year net losses to doubled to $5.6 billion. Sharp Vice President Kozo Takahashi told reporters at a roundtable briefing on the sidelines of the Consumer Electronics Show in Las Vegas that the company’s finances have been weakened considerably and we are considering ways to deal with that.

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Will Sharp Collapse?

Japanese troubled telly maker, Sharp, has warned that if it can’t do something radical soon, its business could go the way of the dodo and T-Rex.

Despite being a major supplier of LCD displays to Apple and other manufacturers, the company has admitted that it can’t survive in its current form. According to Computerworld the company said that there is “material doubt” about its ability to continue operating. The company thinks that it can cut costs and secure enough credit to survive and much of its plan for recovery is based on its IGZO technology for mobile displays.  This technology uses less battery power than existing screens.

Sharp is also carrying out a restructuring plan in which it has reduced headcount, slashed employee salaries and mortgaged its buildings and factories. The company is booking a net loss of $5.6 billion for the year mostly to cover its restructuring costs. Its stock has been downgraded to junk status by ratings agencies and apparently its executives have been seen around Apple and Intel HQ’s with their cloth caps in their hands looking for bail outs, or investments, depending on who you talk to.

Sharp President Takashi Okuda said the company is continuing its  negotiations with Hon Hai, even though so far these have not been going that well. Sharp made a mistake in that it thought that the world wanted LCD panels for large-screen TVs. It is now trying to switch over to the booming market for tablets and smartphones.

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Sharp Electronics Gets Downgraded

Sharp has had its credit rating cut to junk status by the Standard and Poor’s rating agency.

Sharp, which invested heavily during the LCD television boom in the mid 2000s, is now paying the price as demand for televisions slumps across the board. Now Standard and Poor’s has bestowed the ignominy of lowering Sharp’s credit rating to BB+, putting it into what’s called junk status.

Standard and Poor’s also warned that Sharp has weak cash flow and is facing worsening market conditions, two things that will not endear it to investors. It said, “Sharp’s liquidity position has weakened, and the company is highly dependent on short-term borrowings in light of weak internal cash flow and a less favourable funding environment.”

Sharp has had a troubled year and earlier this week announced that it will lay off 2,000 employees in Japan, as its LCD business simply cannot support itself. Standard and Poor’s said that unless Sharp’s fortunes improve, the firm could be hit with another credit rating downgrade.

Standard and Poor’s said, “We may consider lowering the ratings if Sharp’s earnings in (the year to March 2013) and prospects for its recovery deteriorate even further or the company’s financing environment and relationships with credit banks and strategic partners worsen.”

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Sharp To Pay Fine In Price Fixing Settlement

Sharp said on Monday it has agreed to pay Dell and two other firms $198.5 million to settle a lawsuit for fixing LCD panel prices in Europe and North America.

The company agreed to settle the civil lawsuit, which was first filed in November of 2009 against a group of companies including Sharp, Epson, Hitachi and Toshiba for collusion on prices of LCD panels sold to Dell. A Sharp spokeswoman said the company made the decision independent of the other firms involved in the lawsuit, and the payment would settle the suit with Dell. Sharp did not name the two other companies besides Dell.

“After broadly considering factors such as the U.S. civil lawsuit system and the facts of this case, Sharp has determined that agreeing to a settlement is the best policy,” the company said in a statement.

Dell sought damages to recover funds it paid for LCD panels purchased at inflated prices. The lawsuit involved TFT (thin film transistor) panels, widely used in TVs, laptops and handheld gadgets.

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Intel Wants To Deliver Cheap Smartphones

Intel has revealed some additional information on the 2012 mobile strategy to its partners and it even shared some pricing guidelines for mobile products.

According to a slide entitled Mobile Landscape in 2012, Intel wants to sell mobile phones powered by its CPUs for as little as $199 to $299. This is where Intel sees a market opportunity for its phones and the prices are surprisingly low.

It also places netbooks in the same price range $199 to $299 while Intel based tablets should float between $399 and $499. Naturally more expensive options are always a reality. Tablets can go up to 12.1 inches and the starting price for these bigger machines should be $299, and in the high end the sky is the limit.

Hybrid notebooks should stay at less than $699 and this is a category where you can twist the display, slide the keyboard or even take the keyboard off from the netbook, or tablet. Think Asus’ Eee Pad Slider, Transformer, this will give you an idea of what to expect, but with x86 support. Phones, netbooks, hybrids and tablets are all based on Atom architecture.

Intel plans to sell laptops starting at $3xx and up. Probably slightly more than $300, but less than $400 is what they have in mind. Top notch notebooks based on Core i7 chips will start at less than $799 and Ultrabooks with 11-inch or larger screens might be coming down to $599 to $699. Of course, high end models will end up a lot pricier.

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Motorola, Lenovo To Offer Intel-Smartphones

Intel announced multi-year deals with Motorola Mobility and Lenovo to create smartphones and tablets, and said the first Google Android phones using the top chipmaker’s processors would go on sale this year.

Speaking at the Consumer Electronics Show in Las Vegas on Tuesday, Intel Chief Executive Paul Otellini said Lenovo would launch a smartphone for the Chinese market using Intel’s newest chip in the second quarter of the year, while Motorola will release its phone in the second half.

The agreements with the U.S. and Chinese consumer electronics makers help shore up Intel’s boldest foray into the mobile arena. The company is hoping its new “Medfield” chip conserves enough power to compete with rival smartphones using ARM Holdings’ more energy-efficient architecture.

The world’s largest chip maker is also making a concerted push for the likes of Hewlett Packard to go big on super-slim, Apple Macbook Air-like laptops called Ultrabooks, which it hopes will preserve its dominance of the PC market as tablets like the iPad draw consumers away.

“It is a multi-year, multi-product strategy that will bring both phones and tablets to the (U.S.) marketplace starting with a phone in the second half of 2012,” Dave Whalen, a vice president in the Intel Architecture Group, said of the agreement with Motorola.

“You’re going to see us working very closely with them on technologies,” Whalen told Reuters in an interview.

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AMD Makes Gains

Worldwide processor shipments grew during the third quarter this year and Advanced Micro Devices gained market share from Intel over last year despite being plagued by manufacturing problems, according to a study released by Mercury Research on Tuesday.

Shipments of processors during the third quarter went up by just 5% compared to the same quarter last year, according to Mercury Research. Chip shipments have grown despite flat-to-slow growth in PC shipments worldwide over the past year, said Dean McCarron, principal analyst at the research firm.

Intel held an 80.3% market share, a small drop from 80.6% market share during the third quarter last year. AMD’s market share was 18.8%, growing from 18.3% market share last year.

Mercury Research’s numbers cover all x86 systems including laptops, desktops and servers. The company did not provide full microprocessor shipment numbers.

AMD’s Fusion mobile chips for netbooks and laptops are doing much better this year compared to last year, which helped the company gain year-over-year market share over Intel, McCarron said.

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