Thomson and Philips signals that their drastic restructuring strategies are working, the companies said after reporting strong fourth quarter 2003 financial results. Still, the two companies differed sharply on where to go from here, and how each plans to execute plans for building a new core business that will be better shielded from the competitive and low-margin battleground of consumer electronics.

Neither Thomson nor Philips, despite the fame of their brands and their similar roots as leading TV manufacturers, wants to be known primarily as a consumer electronics company.

Thomson is angling to become a one-stop shop for megamedia companies such as News Corp., after completing a series of landmark acquisitions that included Grass Valley and Technicolor. The French company, which owns the leading consumer brands RCA and Thomson, is moving quickly into the more profitable professional video market by offering broadcast equipment, post-production and replication services and broadband access products such as set tops. Thomson's new mantra is to serve those in “the content creation, distribution and access” businesses.

Meanwhile,Philips'strategy under which it will narrow its focus on “healthcare, lifestyle and technology.” Gerard Kleisterlee, president and CEO of Royal Philips Electronics, said it is making a “significant shift to medical and healthcare systems at large.”