Toshiba Exits LSI Chip Business

Toshiba announced Tuesday it is finally ready to exit its money-losing LSI chip business in an attempt to boost profit margins.

Way back in 2018, the company had already sold its flash memory business (now known as Kioxia Holdings Corp.) for $18 billion yen, as it tried to mitigate losses caused by the failure of its US nuclear power unit, and now another step of mending financial dents arrives.

The company said in a statement it decided to withdraw and "establish a solid business structure not easily affected by market fluctuations; one that is sustainable even during the continuing U.S.-China trade conflict." 

Toshiba additionally made it clear it plans to relocate or offer early retirement options to 770 employees at its system LSI business. A comparatively costly step - it will lead to the tech company encountering expenses of $111.77 million, but this has already been placed in its earnings outlook. Its power management chip business will, however, be retained.

It’s interesting to note that the chip business includes image recognition processors supplied to Toyota, but Toshiba did say it would continue sales and support operations for existing customers.

*The products advertised are only available to clients under Fondex Limited Seychelles (SDL No: SD037).