products bore fruit. Demand soared for flash memories and logic ICs used in mobile telephones and digital AV equipment, prompting significant sales increases in this cat- egory. Also favorable were sales of SAW filters for mobile telephones and compound semiconductors for optical transmission systems. As a result, operating income for the electronic devices segment in fiscal 1999 was ¥20.1 billion ($190 million), compared with a ¥83.3 billion loss in fiscal 1998. ($15,144 million). Owing to the expansion of Internet usage, domestic sales of PCs and UNIX servers were buoy- ant, and overseas sales of small form factor hard disk drives for notebook PCs and UNIX servers also increased. However, because of lower IT investment globally due to Y2K-related concerns, sales of global servers fell in Japan, the Americas and Europe. In addition to an ¥87.8 billion ($828 million) impact on overseas sales due to yen appreciation, the sales decline in this category was also attributable in part to the October 1999 merger of Fujitsu's European PC manufacturing and sales subsidiary with a unit of Germany's Siemens AG, making the resulting joint venture company subject to the equity accounting method. Operating income for the category dropped 58.7%, to ¥38.8 billion ($366 million). This reduction was attributable primarily to lower sales of corporate information systems, as well as increased competition in large-scale servers (especially in the US) and substantial price erosion in the small form factor hard disk drive and desktop products businesses. Total sales accounted for by other operations edged up 0.6% from the preceding period, to ¥220.6 billion ($2,081 million). Domestic sales rose 0.4%, to ¥158.1 billion ($1,492 million), while overseas sales expanded 1.2%, to ¥62.4 billion ($589 million). Operating income in this busi- ness segment amounted to ¥3.4 billion ($32 million). In fiscal 1999, the financing segment generated consolidat- ed sales of ¥113.0 billion ($1,066 million) and operating income of ¥3.0 billion ($28 million). This segment was added as the result of the inclusion of Fujitsu Leasing as a consolidated subsidiary beginning in fiscal 1999. Domestic sales in the telecommunications segment rose 5.3%, to ¥417.2 billion ($3,936 million), while overseas sales expanded 24.7%, to ¥355.1 billion ($3,350 million). For the segment as a whole, consolidated sales improved 13.4%, to ¥772.4 billion ($7,287 million). Offsetting increasingly severe market competition in China, which caused a decrease in sales of switching systems, and a ¥44.6 billion ($420 million) decrease in the value of over- seas sales due to yen appreciation, our aggressive efforts to increase both the speed and capacity of network systems that provide Internet and database support were successful; US sales of optical transmission systems surged, and sales of large-scale optical submarine cables also increased. Due in part to active promotion of leading-edge R&D in next- generation mobile communications systems for IMT-2000, growth in operating income in this business segment was limited to a gain of 9.6%, to ¥17.1 billion ($161 million). Overall domestic sales grew 6.3%, to ¥3,631.0 billion ($34,254 million), thanks to improvements in the semi- conductor business. Domestic operating income improved 8.9%, to ¥227.7 billion ($2,148 million). Sales in European markets sank 21.7%, to ¥787.5 bil- lion ($7,429 million), owing to the combined effects of sluggish sales of ICL's ser- vices and software and yen appreciation, as well as the shift to the equity account- ing method for consolidating the results of our European PC sales and manufacturing subsidiary following its merger with a unit of GLYPH<;>GLYPH<;> GLYPH<@>GLYPH<@> GLYPH<;>GLYPH<;> QQ QQ GLYPH<;>GLYPH<;> QQ GLYPH<@>GLYPH<@> Overall consolidated sales of electronic devices rose 12.1%, to ¥568.1 billion ($5,359 million), including domestic sales of ¥296.3 billion ($2,795 million), up 24.4%, and overseas sales of ¥271.8 billion ($2,564 million), which were up 1.3%. Although overseas sales were subjected to a nega- tive yen conversion effect of ¥24.7 billion ($233 million), our efforts to restructure our DRAM business and concen- trate management resources on higher-value-added Europe Electronic Devices Geographic Segment Information Japan Telecommunications Other Operations Financing 21 Net Sales by Customers’ Geographic Location (¥ Billion) '96 '97 '98 '99 '00 GLYPH<;>GLYPH<;> GLYPH<@>GLYPH<@> GLYPH<;> GLYPH<@> QQ Q 5,242 4,985 4,503 3,761 5,255 (Years ended March 31) Japan Europe The Americas Other