Mitsubish Electric Earnings: The Automotive Business Is Making Progress in Its Restructuring

The main highlight of Mitsubishi Electric’s, or MEC’s, September-quarter results was the automotive segment’s turn to profitability, which had been struggling with losses since 2020. In April, the company announced structural reforms, which include discontinuing its car multimedia business and focusing its resources on electrification and advanced driver-assistance systems technologies. We were previously skeptical that the business would return to profitability in this fiscal year, as the company had guided. However, we are encouraged that the business posted an operating margin of 2.0% in the September quarter, an improvement from a loss of 3.3% in the June quarter, turning profitable earlier than we had expected. In addition, the announcement of the spinoff of its automotive business enables the company to accelerate business decisions, demonstrating solid progress in its restructuring.