Sharp Corp. is arguably one of the largest and most-revered display panel manufactures in the world, alongside Samsung, LG and JDI (Japan Display Inc.). The company is known to supply its products to Apple for use in its iPhones and iPads, but many Android OEMs also routinely issue huge purchase orders to the company, which is what makes it one of the very best in the world at what it does. However, the company has been in severe financial distress in recent times, and for the most part, has been unable to get out of the rut by itself. That being the case, Sharp put itself up for sale last year and has since attracted a bevy of suitors who've offered billions of dollars to purchase a controlling stake in the beleaguered tech company.
While Foxconn was initially reported to have made an offer of around $4.3 billion to pick up about a two-third stake in Sharp Corporation, more recent reports indicated that the Taiwan-based contract manufacturing company was seriously considering retrenching its offer by as much as 100 billion Yen ($898 million) to a more modest valuation. Industry sources had reportedly indicated that Foxconn was reducing its offer amidst serious concerns regarding Sharp's business, which has been losing money for quite some time now. Latest news coming out of Japan now lends credence to those earlier reports that outlined the concerns that Foxconn has regarding Sharp's profitability.
According to a report on Friday, Sharp has admitted that its revenues this year will most likely fail to match its earlier guidance, mostly due to a stagnation of demand from China. If those fears do turn out to be valid, the company will apparently lose hundreds of millions of dollars, as per reports in the Japanese mainstream media. Last October, the company had forecast an operating profit of around 10 billion yen ($88 million) for this fiscal. While Sharp is not the only Japanese display panel maker that's in trouble thanks to the Chinese slowdown and Apple's stagnating sales, the company has been hit more severely by adverse market conditions than its fellow compatriot, JDI, who too has recently forecast losses for the current quarter because of the exact same reasons that have wreaked havoc with Sharp's financials.