Fujitsu, the Japanese chip and PC giant that employs more than 1,000 people in Northern Ireland, has warned it is expecting a net loss of £1.25 billion sterling (#2.04 billion) this year and may be forced to cut thousands of jobs worldwide.

The group issued a profits warning earlier this month and latest quarterly results posted yesterday showed no recovery in its performance.

Mr Takashi Takaya, Fujitsu's executive vice-president, said the group now planned a major restructuring of its operations to focus on the semiconductor and information processing-device divisions.

He said the group would cut employee numbers and expected the restructuring process would cost Fujitsu several million pounds.

Mr Takaya said one option the Japanese group was also considering was to stop production at its US plants to align production to market demand.

Fujitsu is hopeful it will be profitable again by the next financial year but many analysts believe it will have to significantly reduce overheads and employee numbers.

Mr Takaya said: "As a way to restructure and review our business, we will reorganise factories around the world, with more than half of the restructuring focused on the semiconductor business.

"We will put more focus on profitable core businesses by backing away from unprofitable information-processing operations such as small hard-disk drives for PCs and strengthen our software business."

He said the group would not restructure its software divisions but predicted there would job losses in all other sectors.

No details have yet been disclosed about which countries or sites will be affected by the restructuring programme.