Toshiba Cuts Profit Target 31% on Chip Prices, HD DVD

"Toshiba Corp., Japan's largest chipmaker, cut its full-year profit forecast by 31 percent because of falling prices for flash memory and costs to withdraw from the HD DVD business.

Net income will probably decline 9 percent to 125 billion yen ($1.3 billion) in the 12 months ending March 31, the company said in a statement today. Tokyo-based Toshiba in October forecast net income would rise 31 percent to 180 billion yen.

The company said it will book a 45 billion yen charge to write down the value of its HD DVD assets, forcing Toshiba to face its first annual profit drop in six years. Toshiba also forecast prices of flash memory chips, its biggest source of income, will fall faster than it expected amid a glut. "

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