TOKYO (Reuters) -Japanese electric motor maker Nidec on Tuesday posted an operating loss for the January to March quarter, hit by the costs of restructuring steps taken to deal with fierce price competition in China’s electric vehicle market.
The company’s fourth-quarter operating loss was 6.17 billion yen ($40 million), undershooting an average estimate for a 21.48 billion yen profit in a survey of eight analysts by LSEG.
Nidec has sought to tap a growing share of the battery-powered vehicle market globally through developing and making an e-axle traction motor that combines an EV’s gear, motor and power-control electronics.
In January, however, the Kyoto-based manufacturer had slashed its operating profit estimate for the year that ended March 31 by nearly a fifth to 180 billion yen, warning of uncertainty in demand and intensifying price competition in China’s EV market.
For the current business year to March 2025, Nidec expects its operating profit to grow 41% from a year earlier to 230 billion yen, although the outlook is still below an average estimate of a 242.93 billion yen profit by 18 analysts.
“Signs of recovery in demand for IT-related equipment is gradually coming into sight,” Nidec said in its financial statement.
“In addition, new business opportunities such as water-cooling modules are emerging with the increase of demand for data centers in the fields of generative AI.”
Ahead of the announcement, shares of Nidec closed down 0.25%, underperforming the benchmark Nikkei average, which gained 0.3%. But the stock has still gained about 18% so far this year.
($1 = 154.7300 yen)
(Reporting by Daniel Leussink, Kiyoshi Takenaka; Editing by Christian Schmollinger and Kim Coghill)