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Monday, May 27, 2024

NEC Corp. shares surge in Tokyo after fiscal-year operating profit surges 29%

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NEC Corp. shares rose sharply Monday morning after it posted a 29% increase in fiscal-year operating profit on strong demand for information-technology services and projected further earnings growth.

The shares

closed the morning session 14% higher at 5,940 yen after rising as much as 16% earlier.

The Japanese information-technology and electronics company said Friday after market close that operating profit increased to Y170.45 billion ($1.25 billion) for the fiscal year ended March 31, from Y132.525 billion the previous fiscal year.

Revenue rose 9.9% to Y3.313 trillion, thanks to greater demand for information-technology services across various industries. Net profit dropped 19% to Y114.50 billion due to higher tax expenses.

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Adjusted operating profit from NEC’s enterprise segment climbed 28% to Y73.4 billion owing to higher sales to financial, manufacturing, retail and services clients. Adjusted operating profit from its global segment jumped 63% to Y42.9 billion due partly to the software and submarine businesses.

For the fiscal year that started in April, NEC projected revenue to rise 2.0% to Y3.380 trillion and adjusted operating profit to increase 7.0% to Y220.00 billion.

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