Panasonic to Lay Off 10,000 Workers to gain more profit

Panasonic Holdings announced plans to cut 10,000 jobs in the current fiscal year, as part of a comprehensive overhaul aimed at boosting profitability. The electronics giant will implement the cuts evenly across Japan and overseas, targeting sales, indirect operations, and underperforming business units. 

The employees will be getting early retirement.  This cutoff has been estimated a restructuring cost of USD 896 billion.

The cutoff aims to gain more structured operations and improved financial performance, with Panasonic targeting a return on equity of 10% by the fiscal year ending March 2029. 

The company also aims for adjusted group operating profit of at least 600 billion yen by March 2027, which will be driven by restructuring its consumer electronics division, exiting unprofitable segments, and optimizing IT investments.

Approximately half of the restructuring costs will be allocated to its Lifestyle business, which includes home electronics and HVAC systems. Another 40% will be allocated to other segments, such as the holding company. Notably, no restructuring costs are expected in its energy business.

Despite the broader restructuring, Panasonic upgraded its forecast for its electric vehicle (EV) battery division—its energy business expects a 39% increase in operating profit to 167 billion yen for the fiscal year ending March 2026, buoyed by rising demand from Tesla and other automakers.

However, the company projects a 13% decline in overall operating profit to 370 billion yen for the current fiscal year, down from last year’s figures, underscoring the transitional challenges ahead.