Fujitsu, the Japanese technology giant, has announced plans to phase out its mainframe business by 2035. This confirmation comes as CEO Takahito Tokita laid out the company’s medium-term management strategy and future direction during a briefing earlier this week. The year 2035 not only marks the end of mainframes for Fujitsu but also coincides with the company’s centenary, a milestone Tokita believes will usher in some of its most significant innovations.
During the briefing, Tokita expressed optimism about the future, envisioning that Fujitsu will pivot towards producing “AI supercomputers,” utilizing its “Monaka” CPUs developed in collaboration with Broadcom, along with inferencing chips from French firm Scaleway. He indicated that these advanced computing systems, or potentially quantum computers, would become essential tools in the marketplace, taking the place of the company’s traditional mainframes.
“Everything Fujitsu does in the future will involve AI,” Tokita asserted, noting that the company intends to use its own AI technologies to guide its management strategies. The CEO emphasized the establishment of a globally standardized data platform this fiscal year to facilitate AI-driven management, which aims to enhance decision-making processes and management quality.
Fujitsu’s shift extends beyond just technology; the company plans to adapt its business model significantly. Moving away from its traditional systems integration work, Fujitsu will adopt an “earnings structure based on value and outcomes,” as described by Tokita. This change aims to create a more balanced revenue distribution throughout the year, as the company has historically experienced concentrated revenues in the fourth quarter. “Achieving a more even distribution of revenue across quarters is extremely important for improving the quality of our management,” he added.
Tokita mentioned ongoing improvements in Fujitsu’s pricing model, which will include metrics based on personnel workload and data requirements for the technologies provided. This strategic pivot reflects the CEO’s recognition of the need for adaptation in a rapidly evolving tech landscape.
In a notable personnel shift, Fujitsu Japan has ceased its annual graduate intake and is now focused on hiring individuals with specific skill sets that align with the company’s future direction. This move indicates a strategic realignment to ensure that the workforce is equipped to meet the demands of Fujitsu’s evolving technological landscape.
When discussing the company’s potential involvement in defense projects, Tokita offered a tantalizing hint but refrained from providing detailed specifics. Nonetheless, he acknowledged the importance of diversifying into sectors that could provide robust revenue streams.
The urgency behind these changes is underscored by Fujitsu’s recent financial performance. Full-year revenue experienced a decline of 1.3 percent year-over-year, totaling $22.3 billion, although profit surged by 31 percent to $2.2 billion. The company’s pivot toward AI and a focus on innovative business models appear to be critical strategies aimed at reversing revenue trends and bolstering future growth.
As Fujitsu prepares to enter its centennial year, the company’s transformation plans signify not just a shift in technology but also a broader response to the changing demands of global markets. The upcoming years will be crucial for Fujitsu as it endeavors to redefine its business and leverage the potential of artificial intelligence to maintain relevance in an increasingly competitive landscape.
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