Fujitsu plans to end production of read/write heads for hard-disk drives as part of a wider review of its HDD business.
The company will exit the head business at the end of March. The move will affect about 360 employees at its factory in Nagano, Japan, who will be reassigned to other operations within the Fujitsu group.
The head is the component that reads and writes data on to and from the spinning magnetic disc at the heart of a hard-disk drive.
The discontinuation of HDD head operations will mean a one-time facilities-related loss of ¥5bn (£35m) will be recorded in its results for the last three months of 2008.
Fujitsu's review of its hard-disk drive business has seen it in talks with Western Digital and, most recently, Toshiba, according to local press reports. Toshiba, which is tipped to buy the business, confirmed last week that it's in talks with Fujitsu but said nothing had been decided.