Kyocera to Share Research Costs

Kyocera Corp., which makes handsets for Carlyle Group Inc.’s Willcom Inc. and KDDI Corp., plans to boost profit by sharing research costs at its mobile phone and network businesses in Japan, U.S. and China, its president said. The company is creating a new unit to combine the businesses and shifting some development operations to India, President Makoto Kawamura said in an interview in Kyoto yesterday. The new unit will comprise of the company’s handset-making business in Japan, San Diego, California-based Kyocera Wireless Corp. and a cell phone business in China, Kawamura said.

Kyocera is forecasting a 3.7 percent operating profit margin at its telecom business this fiscal year, about a third of the margins for Motorola Inc. and Nokia Oyj, the world’s two biggest handset makers. The company is also aiming to boost profitability to help counter losses at its U.S. mobile phone-making unit.

The cost reductions at the telecom business will be reflected in earnings during this fiscal half ending March 2007, he said, without giving specifics. Kyocera is forecasting annual net income to rise 19 percent to 83 billion yen ($717 million) on sales of 1.23 trillion yen. Kyocera owns about 13 percent of KDDI and has a 30 percent stake in Willcom. Continue>>