Japan's Toshiba is expected to swing to a half-year operating loss of about 30 billion yen ($287 million) on a weak microchip business, a newspaper said on Thursday.

Josef Thiel Toshiba Corporation Headquarters, Tokyo

Toshiba the shares plunged nearly 7 percent, underperforming a 3 percent slide in the Nikkei average.

Sliding prices of NAND flash memory chips, used in portable music players, digital cameras and cellphones, are hurting Toshiba and rivals Samsung Electronics and Hynix Semiconductor.

Toshiba, the world's No.2 maker of NAND, is likely to cut its full-year outlook from a previous forecast for a 22 percent rise in operating profit to 290 billion yen, the paper said.

Sixteen analysts project on average a profit of 191 billion yen, according to Reuters Estimates.

Toshiba will consider cutting capital spending on its chip business from a planned 367 billion yen for the year to March, the Nikkei reported.

Sales were expected to fall 2 percent from the previous year to slightly more than 3.6 trillion yen, falling nearly 200 billion yen short of the initial outlook, it said.

This would be Toshiba's first operating loss for the first half of the business year in five years. In April-September last year the company posted an operating profit of 82.5 billion yen, and it has forecast a 70 billion yen first-half profit this business year.

Toshiba, which also makes nuclear reactors and LCD TVs, said in a statement that it did not announce the reported earnings figures. A spokesman declined to comment further.

For April-June, Toshiba made its first quarterly loss in three years on falling prices and slow sales of chips, but it kept its full-year outlook unchanged.

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