Sony Profit Falls 95%, Cites Electronics Woes

Jan 22, 2009  •  Post A Comment

Sony said today that its fiscal third-quarter profit fell 95% from a year earlier and cut its sales and earnings forecast for the year ending March 31. The drop was partially due to the worse-than-expected performance of its electronics division, which includes television-making operations.
Sony’s net income for the quarter ended Dec. 31 was 10 billion yen ($112.7 million), down from 200 billion yen ($2.25 billion) a year earlier, as sales fell 25% to 2.86 trillion yen ($32.2 billion), the company said in a preliminary earnings report today.
For the year ending in March, Sony’s revenue will be 7.7 trillion yen ($86.7 billion), 14% less than the company forecast in October, while the company will have a net loss of 150 billion yen ($1.69 billion) instead of the 150 billion yen net profit it previously forecast.
Sony, the world’s second-largest television maker after Samsung, also said the fiscal year’s operating profit for its electronics division will be about 340 billion yen ($3.83 billion) less than it forecasted in October, primarily because of the deteriorating global economy, as well as the strengthening yen.
Retailers cut prices on TVs and other electronics components to move inventory during a sluggish holiday season. The average price of a TV sold in the U.S. the day after Thanksgiving, or so-called Black Friday, was $676, down 19% from a week earlier and 3% less than the corresponding year-earlier day, NPD Group unit DisplaySearch said last month.
Sony sold about12% of the world’s televisions in the third quarter, second only to Samsung’s 23% market share, NPD Group unit DisplaySearch said in November. No. 3 TV maker LG Electronics said late yesterday that its fourth-quarter loss from its TV-making operations widened 27% as the company dropped the prices for its flat-screen TVs. Samsung reports earnings later today.


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