Sony profit forecast cut after loss
The flop of action movie White House Down added to earnings woes at Sony in the latest quarter, dragging the entertainment and electronics giant to a 19.3 billion yen (£122 million) loss.
The film's lacklustre box office performance, especially compared with last year's releases of 21 Jump Street and The Amazing Spider-Man, contributed to a 17.8 billion yen (£113 million) operating loss for Sony's pictures division, the company said.
The company slashed its profit forecast for the fiscal year ending in March to 30 billion yen (£190 million) from 50 billion yen (£317 million), partly reflecting deep-seated problems in its electronics business, televisions in particular.
Sales for the July-September quarter rose 10.6% from a year earlier to 1.78 trillion yen (£11 billion), thanks mainly to the favourable impact of the yen's decline against the US dollar. Adjusted for the 20% drop in the value of the yen, revenue fell 9%.
The company's sales of digital cameras and video cameras fell while its television, music and smartphone businesses improved. Sales of its Xperia Z smartphone helped and are expected to remain strong, the company said.
Although sales of televisions and personal computers improved slightly from earlier in the year, they were lower than the same quarter of 2012.
"The electronics business is declining beyond expectations" due to shrinking sales of televisions and other audio-visual equipment, along with slowing growth in major emerging markets such as China, the company said in its presentation.
"Sony expects its business environment to continue to be severe in the second half of the fiscal year," it said.
Sony said it is striving to improve profitability at its troubled television division by focusing on sales of higher cost products such as its 4K LCD TVs.
The company, which has suffered declining fortunes for several years, is also gearing up for the launch of its PlayStation 4 game machine.
But it still faces fierce competition from Apple's iPad and iPhone as well as from powerful South Korean rival Samsung.
Sony sank to record losses for the fiscal year ended March 2012, reporting the worst result in the company's six-decade history.
Still, its loss for April to September narrowed to 15.8 billion yen (£100 million) from 40 billion yen (£254 million) in the first half of the previous fiscal year.
Rival Panasonic, meanwhile, said its quarterly profit improved to 63.3 billion yen (£401 million) from a 698.6 billion yen loss the year before.
Panasonic, like Sony, has benefited from the weaker yen. While its domestic sales fell 4%, sales overseas climbed 11%. Total revenue of 1.88 trillion yen (£11.9 billion) was up 3% from a year earlier after taking a hit from the sale of Sanyo businesses carried out in the current fiscal year.
Panasonic raised its sales forecast to 7.4 trillion yen (£47 billion) and doubled its profit forecast for the fiscal year to 100 billion yen (£624 million).