Sharp's operating performance has exceeded our expectations thanks to steady benefits of cost reductions it has made since joining the Hon Hai group in mid-2016. We expect a gradual recovery in its ability to generate earnings and somewhat stabilize its financial standing to continue for the next one to two years because of its steps to stabilize earnings, mainly in its liquid crystal display (LCD) business. We are raising our long-term corporate credit and senior unsecured debt ratings on Sharp two notches to 'B+' and one notch to 'B', respectively. We are affirming our 'B' short-term ratings on Sharp. The outlook is stable, reflecting our view that Sharp will continue to reap benefits from its partnership with Hon Hai, somewhat
