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Actions to stabilize System LSI business

May 13, 2019

Toshiba Electronic Devices & Storage Corporation

Toshiba Group announced the Toshiba Next Plan as a five-year transformation plan for securing profitable and stable growth in November 2018. Subsequent to this, in response to the recent sudden and unexpectedly large fall-off in semiconductor demand, Toshiba Electronic Devices & Storage Corporation has decided to take further actions to strengthen the System LSI business’ resistance to fluctuations in the market and to stabilize the business.

Through these measures, the company will engineer a return to the black and the path of stable, profitable growth within fiscal 2019. Going forward, these measures will also support achievement of the Toshiba Next Plan and contribute to the maximization of corporate and shareholder value, and that of Toshiba Group.

1. Further concentrate on focus areas

Toshiba Electronic Devices & Storage Corporation anticipates steady mid- to long-term growth in demand for System LSI for automotive and industrial applications, due to advances in the electrification of automobiles, the expansion of eco-friendly cars and increasing energy saving initiatives, and has already been shifting its focus to these markets. Closer concentration on them will further contribute to the progress of industry and society.
 

In addition to digital ICs, including the Visconti™ image recognition processor, one of our long-standing focus products, the company will channel further resources into enhancing its product offerings in microcontrollers (CPUs) and analog ICs, particularly motor driver ICs, drawing on strengths in high-level efficiency and low power consumption.
 

In Logic LSIs, the emphasis will be on developing products that increase the value delivered to customers.

2. Strengthen technological advantages

The company will further strengthen product competitiveness by taking full advantage of its technological advantages and using resources to widen the scale of product offerings.

(1)  Digital ICs: Draw on strengths in future key technologies in the automotive market, such as AI, functional safety, low power consumption and security.

(2)  CPUs: Broaden the product portfolio and enhance security technologies, one of the biggest social requirements, so as to satisfy a wide range of customer needs.

(3)  Analog ICs: Strengthen high efficiency, low power consumption motor drive technology and high precision digital conversion technology, so as to offer higher value-added products.

3. Strengthen system-based solutions approach

In promoting System LSI, it is crucial to get a very early understanding of customer needs and offer system-based solutions. Toward this, the company has strengthened a system-based approach since fiscal 2017, with measures that include establishing the Automotive Solutions Strategic Planning Dept. Activities like this will be further advanced by fully utilizing accumulated expertise. More recently, the company merged its two System LSI-related divisions into a new System Devices Division, and consolidated its technical support companies for Discrete Semiconductors and System LSIs, and will build on this by promoting closer collaboration with Discrete Semiconductor Division, which has a broad product portfolio and a wide customer base. This will strengthen capabilities in proposing cross-product solutions.
 

In Digital IC, Visconti™ has been adapted for automotive front-camera-based active-safety systems. By establishing a dedicated promotion team to further pursue opportunities outside the automotive market, Visconti™ will be cultivated as a growth business.

 

4. Secure a resilient business structure

As announced on May 13, 2019, Toshiba Electronic Devices & Storage Corporation will implement structural reforms, including an early retirement incentive program, to realize a personnel structure commensurate with sales and business scale. Measures will also be taken to lower fixed costs and improve the marginal profit ratio, including increasing utilization rates at Japan Semiconductor Corp. by raising production of power devices and improving the product mix by increasing the percentage of new products.

* Visconti™ is a trademark of Toshiba Electronic Device & Storage Corporation

* All other company names, product names and service names may be trademarks of their respective companies.

*Information in this document, including product prices and specifications, content of services and contact information, is current on the date of the announcement but is subject to change without prior notice.

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