TOKYO, July 31 Japanese IT services provider NEC
Corp said on Wednesday it would halt development of new
smartphones and restrict its future smartphone business to
existing models as it dramatically restructures its business.
NEC's mobile handset business has faltered as sales of
popular smartphones made by Apple Inc and Samsung
Electronics Co Ltd boomed over the past decade. It
now has barely a 5 percent share of the domestic handset market,
trailing Japanese peers such as Fujitsu Ltd and Sony
NEC's handset business posted an operating loss of 9 billion
yen ($91.8 million) for the April-June quarter, the company said
in its first-quarter earnings results on Wednesday.
NEC was in discussions to sell its mobile phone business to
Lenovo Group Ltd but a source familiar with the matter
has said the talks stalled this month due to disagreements over
majority ownership and patents.
NEC cut more than 10,000 jobs last year after posting a
combined $1.24 billion in net losses in the 2010 and 2011 fiscal
years. This year NEC has received $1.3 billion in funding from a
group of lenders including the Development Bank of Japan to help
it shed loss-making operations.