Sony Corp Post Surprising Q1 Profit News
Chris Leyton
28/07/2004
Sony Corp surprises the analysts with a healthy quarter, despite the continued loss of the gaming division…
Sony Corporation surprised the financial industry by posting a quarterly profit on the back of strong sales for its digital camera products.
For the three-month period ending June 30th, Sony defied the analysts by posting an operating profit of 9.8 billion yen, although this marked a 41% decrease from the same period a year ago. Revenues during the period rose by 0.5% to 1.6 trillion yen, whilst net income rose to 23.3 billion yen compared to a profit of 1.1 billion a year ago.
The reason behind the surprise announcements stems from the weakened state of the yen, which currently stands at 109 yen per dollar and 131 yen per euro, compared to Sonyâs expectations of 105 yen per dollar and 125 yen per euro, effectively boosting the value of overseas sales when converted into yen.
However the good news didnât stretch too all divisions of Sony Corp, with its gaming division posting a loss of 2.88 billion yen, hurt by a decline in hardware sales and continued investment into the R&D and manufacturing of future products.
Sony decided against revising its full-year expectations, forecasting an operating profit of 160 billion yen in the year to March 31 2005, after a further 130 billion yen of restructuring costs. Representatives confirmed that the corporation is currently half way through its three-year restructuring plan, aimed at reducing fixed costs and securing its supplies of key semiconductors and display panels to improve its profitability.