Sharp on Monday warned of financial loss mainly due to declining sales of to smartphone displays. The Japanese firm said it would book an operating loss for April-September rather than a profit, revealing little sign of a turnaround since a $1.7 billion bank bailout in May.

The electronics maker, due to report its first-half financial results this Friday, says that a sales decline and drop in market prices for liquid crystal display (LCD) panels used in smartphones is the culprit responsible for Sharp's latest profit drop.

According to the firm, "intensified competition" in the small and medium-sized LCD business will result in a forecast operating loss of 26 billion yen ($215 million).

Sharp has also pushed down its full-year profit forecast to 10 billion yen from a previous estimate of 80 billion yen.

Sharp, once among the top suppliers to Apple, has lost market share in recent years to the likes of LG Display and domestic rival Japan Display Inc. The company continues its a three-year restructuring plan, which includes job cuts and sale of units which were not turning a profit.

In September, reports suggested electronics manufacturer Hon Hai was mulling over the potential purchase of Sharp's display business.