Fanuc shares plunged the most in four decades after the maker of factory robots raised its profit outlook by less than expected, heightening fears about soaring prices of materials.
The supplier of robotic arms raised its full-year operating profit forecast by about 3%, after reporting a 37% surge in orders in the June quarter. That disconnect sent shares tumbling 19% Monday morning in Tokyo, the biggest intraday decline since 1986. The stock has now lost around 3% since the start of the year.
Fanuc said on Friday that it has been undertaking efforts to procure materials and components as well as slash costs. Like other manufacturers, Fanuc has been hurt by rising costs of semiconductors, other electronic parts and shipping. It now expects operating profit to grow 19% to ¥218 billion ($1.4 billion). Analysts on average expected a 23% rise.
“Procurement issues are a headache for the company,” Graeme McDonald, director of Citigroup’s Pan-Asia capital goods sector, said in a note. The company’s operating profit guidance looks conservative, he said.
Last month, the company said it’s teaming up with Nvidia alongside Fujitsu, Kawasaki Heavy Industries and Yaskawa Electric in areas spanning factories, retail, logistics and health care. That underscored surging demand across industries to translate AI’s command of language into the physical realm.
