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Sony still struggling amid global slump

Sony still struggling amid global slump

Japanese electronics and entertainment company Sony Corp. reports fiscal second quarter earnings on Friday. The following is a summary of key developments and analyst opinion related to the period.
OVERVIEW: Sony was already been struggling to turn itself around when the global financial crisis hit last year, further endangering its earnings. The strong yen, which erodes overseas profits, and increasing price competition in gadgets are also dragging on the performance of the maker of the Walkman portable music player. Tokyo-based Sony is up against formidable rivals like Samsung Electronics Co. and Apple Inc. But there have been a few bright spots, such as the recent price cut for the PlayStation 3 that boosted the console's sales to a million globally in just three weeks. In Japan, government-backed discounts for energy-saving gadgets, including flat-panel TVs, may also help lift sales.
BY THE NUMBERS: Tokyo-based Sony is projecting a 120 billion yen (US$1.28 billion) loss for the fiscal year through March 2010. That would be worse than the 98.9 billion yen fiscal loss recorded for the previous fiscal year, the company's first red ink in 14 years.
ANALYST TAKE: Kazuharu Miura, analyst at Daiwa Securities SMBC Co. in Tokyo, expects Sony to do better than its own forecast for the full year, although it will continue to stay in the red. Recent price drops on flat-panel TVs have been lower than expected, although unit sales may be falling short, he said in a recent report. "Closely being watched are Sony's views on its flat-panel TV, digital imaging and gaming businesses," he said. "It has been difficult to gauge its medium-term growth scenario."
WHAT'S AHEAD: Japanese electronics makers like Sony are counting on the year-end season for a significant portion of its sales. But the economic slowdown in the key U.S. market is likely to weigh on such earnings.


Updated : 2021-06-18 11:04 GMT+08:00