Fujitsu Spins Off PC and Smartphone Operations
Fujitsu Ltd., a Japanese multinational information technology services and equipment company, operates as the world’s fourth-largest IT services provider measured by revenues. The company has recently announced that they will be spinning off its smartphone and personal computer operations into two distinct, separate wholly-owned subsidiaries by February 1. This decision was approved in a board meeting which took place on December 24, making Fujitsu the most recent tech giant to divide its computer server, technology services, and networking equipment divisions from their other operations which sell relatively low-margin commodity products.
This spinoff trend started around a decade ago in 2005, when IBM sold its PC division to Lenovo. Prior to Fujitsu’s announcement, the most recent spinoff was the Hewlett Packard Enterprise and HP Inc. split which became official on November 1. Fujitsu’s announcement does not appear to be much of a surprise though, as PC shipments are forecasted to fall by more than 10% this year. Fujitsu intends on continuing ownership of the two business entities, but wants the management of the two companies to be entirely responsible for their own business results.
“With the ongoing commoditization of ubiquitous products, mainly of PCs and smart phones, it has become increasingly difficult to achieve differentiation, and competition with emerging global vendors has intensified,” said the Fujitsu board in a statement.
Allegedly in early December, there were several news reports which speculated that Fujitsu was considering a three-way agreement among Toshiba and Vaio, a company which was created by Sony Electronics when they spun out its PC business last year. This potential agreement would have created for Japan’s largest PC manufacturer, though it still would have only ranked seventh in the world in terms of unit shipments.
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