Japan’s Sony Corp yesterday announced smaller-than-expected first quarter losses, helped by cost cuts, but kept its forecast for a second straight year in the red because of slumping sales.
Like other Japanese high-tech giants, Sony has been badly hurt by the global economic downturn, which has depressed demand for televisions and other electronic gadgets and pushed up the value of the yen.
Sony posted a net loss of ¥37.1 billion (US$390 million) for the fiscal first quarter through last month, reversing a year-earlier profit of ¥35.0 billion. Markets had expected a bigger loss of about ¥110 billion.
It logged an operating loss of ¥25.7 billion, against a year-earlier profit of ¥73.4 billion, as revenue slid 19.2 percent to ¥1.60 trillion.
The maker of Bravia televisions, PlayStation game consoles and Cyber-shot cameras maintained its forecast for its first back-to-back annual losses since it was listed on the stock market in 1958.
The company also announced that it had entered into a joint venture agreement with fellow high-tech giant Sharp Corp to produce and sell large liquid crystal display panels and modules.
Sony will invest ¥10 billion for a 34 percent stake in the venture, with Sharp taking majority ownership.
Sony, which announced in May its first annual loss in 14 years, expects to end the current business year ¥120 billion in the red. The company has had a difficult few years in the face of tough competition from rival products such as Apple’s iPod and Nintendo’s Wii.
Nintendo Co said yesterday its net profit plunged 60.6 percent in the quarter to last month from a year earlier to ¥42.32 billion (US$445 million) as sales of its Wii console dropped sharply.
The company sold 2.23 million Wii video game machines worldwide in the fiscal first quarter, down from 5.17 million a year earlier.
But the group expects its first drop in operating profit in four years, underlining the challenge it faces in maintaining its recent rapid growth.
Sharp said yesterday it booked a net loss of US$265 million in the three months to last month on lower sales and restructuring charges, but expected to return to profit for the full year.
The company reported a net loss of ¥25.2 billion for the quarter, reversing a year-earlier profit of ¥24.9 billion.
Revenue tumbled 20 percent to ¥598.3 billion, hit by lower sales of flat-panel TVs and cellphone handsets as well as sharp price drops in liquid-crystal displays (LCDs), a core product for the group.
Sharp maintained its outlook to return to profit on a full-year basis.
It expects a net profit of ¥3 billion and operating profit of ¥50 billion for the year to next March on revenue of ¥2.75 trillion, all unchanged from estimates it released in April.