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Toshiba Corporation Annual Report 1998 3.
Fumio Sato (left), Chairman, and Taizo Nishimuro, President
■ Notebook PCs — Aim ing for Stable Earnings
Toshiba’s share of the portable PC m arket in Europe rose to about 30 percen t during th e past
fiscal year. However, in th e United States, increased output by PC makers caused a high level of
inven tories, which resulted in a sharp drop in prices. Th e im pact on earn ings was substantial.
We believe that th e global PC m arket will continue to expan d at a double-digit pace. The por-
table PC category, where we are strongest, is likely to grow even faster. Our goal is to recapture
our mom en tum in PCs. Durin g th e curren t fiscal year, we will laun ch m ore econ om y-priced
notebook m odels. We will also expand our lin e of slim -profile and m in inotebooks, wh ich will
becom e m ainstream products. An ongoing sh ift to the build-to-order system will further h elp
stabilize earnin gs.
■ Semiconductors — Returning to a Globally Competitive Position
In 16M DRAMs, Tosh iba unfortunately was not able to achieve market-leadin g com petitiven ess.
For 64M DRAMs, however, we will again ran k am ong the leaders in terms of perform an ce an d
cost. This belief is based on kn owledge gained th rough th e join t developm en t of 256M DRAM
technology with IBM Corp. and Siem en s AG. We are con fiden t of catchin g up to th e cycle of
price fluctuation s because of our ability to ach ieve reduction s in ch ip size. We now have th e
technology n eeded to m ass produce 0.15-m icron design rule devices with sm aller capital in vest-
m en ts th an oth er suppliers require. We refer to th is advantage as “superiority from scalability.”
Im provin g th e com position of sales will also m ake us more com petitive. In fiscal 1995 when
m em ory prices were h igh, these devices were about 40 percen t of Tosh iba’s semiconductor sales.
Our goal is to con sisten tly gen erate m ore than 40 percen t of sem icon ductor sales with logic ICs
with em ph asis on system LSIs an d ASICs. Logic IC sales are growin g steadily; orders for m any
strategic products are already increasin g.