HD DVD flop costs Toshiba $1.1 bil

Amount is more than double earlier projection

By MARK SCHILLING

TOKYO -- Toshiba has announced that its losses from dropping the HD DVD biz will hit 110 billion yen ($1.1 billion) for the 2007 fiscal year, more than double its earlier projected loss.

On Wednesday Toshiba also said that it has revised its net profit forecast for the year ending March 31 down by 30% to $1.25 billion, with its defeat in the next-generation DVD format war weighing heaviest.

Tougher than expected competition in the flash memory chip market also dragged down the profit estimate. Operating profit is projected to fall to $2.3 billion from $2.58 billion in 2006.

Despite these negative numbers, Toshiba expects revenue to rise to $77 billion, compared with $71.2 billion the previous fiscal year.

Toshiba abandoned the HD DVD biz in February after key ally Warner Bros. went over to the rival Blu-ray camp. The decision of the Wal-Mart chain to stock only Blu-ray players and discs in its stores was another major blow.