The job cuts are part of a broader strategy to improve operational efficiency, particularly in sales departments, as highlighted by CEO Yuki Kusumi during an online press conference.

In response to U.S. tariffs on Chinese imports, Panasonic is working to reduce its reliance on China for electric vehicle battery supplies, as emphasized by Allan Swan, president of Panasonic Energy North America.

As part of its restructuring, Panasonic plans to divest from loss-making activities and close or integrate facilities that do not show prospects for profit improvement.

The company aims to focus on growth areas such as energy services related to data centers, software, and industrial automation, while also seeking to enhance profitability in its battery and consumer electronics divisions.

For fiscal 2026, Panasonic forecasts a revenue of 7.80 trillion yen and a net profit of 310 billion yen, although these projections do not account for the impact of U.S. tariffs.

Despite its historical leadership in various technologies, Panasonic faces increasing competition from companies like LG, Samsung, and Chinese manufacturers, which has prompted the need for these drastic measures.

On May 9, 2025, Panasonic Holdings announced a significant restructuring plan that includes cutting 10,000 jobs and incurring approximately 130 billion yen (about $896 million) in restructuring costs during the current business year.

Although Panasonic reported a 74% increase in net income for the March quarter, its sales in the in-vehicle energy segment have been declining, largely due to a slowdown in overall electric vehicle (EV) demand.

Kusumi expressed that these job cuts are essential for preparing the company for future growth over the next decade or two, reflecting a commitment to long-term sustainability.

The restructuring efforts are designed to enhance profitability and achieve a return on equity of 10% by the end of the fiscal year in March 2029.

Additionally, Panasonic plans to pay an annual dividend of 48 yen per share for fiscal 2025, marking a 13 yen increase compared to the previous fiscal year.

Following the announcement of the job cuts, Panasonic's shares rose by 2% in Tokyo, indicating a positive market reaction to the restructuring news.