Japan Inc’s third-quarter profits fell at the sharpest rate since the 2011 Fukushima earthquake and tsunami as companies faced an abrupt slowdown in China’s economy owing to the US trade dispute.
Following years of robust growth under Prime Minister Shinzo Abe’s pro-business economic policies, Japanese companies were also hit by global growth fears that have also affected technology giants such as Apple and Intel. A series of downgrades in annual profit forecasts by Nidec, Panasonic, Fanuc and other manufacturers were accompanied by warnings about the lack of clarity about when a recovery would happen.
“We think we hit a bottom during the October to December quarter. But the biggest problem is that we just cannot foresee the timing of a recovery,” said Yoshiharu Inaba, chief executive of industrial robot maker Fanuc, which lowered its guidance following a 42 per cent fall in quarterly operating profit.