Sony Second-Quarter Profit Falls Nearly 86%
Earnings hurt by strong yen
By Alexander Martin Updated Nov. 1, 2016 4:25 a.m. ET
A Sony booth at a photography trade fair in Cologne, Germany, in September. ENLARGE
A Sony booth at a photography trade fair in Cologne, Germany, in September. Photo: Bloomberg News
TOKYO—Sony Corp. reported Tuesday a plunge in its operating and net profits for its fiscal second quarter as it booked losses from the sale of its battery business and the strong yen hit its profitability.
For the second quarter that ended in September, the Japanese electronics company said operating profit fell to ¥45.7 billion ($436 million) from ¥88 billion a year earlier. Sony posted a net profit of ¥4.8 billion for the July-September period, compared with ¥33.6 billion the previous year.
Sony said the weak results came from booking the bulk of the ¥33 billion in one-time losses stemming from the sale of its battery arm. The company said it booked ¥32.8 billion of the impairment charge in the second quarter.
Sony had lowered its earnings forecast Monday for the fiscal year that ends in March, citing the sale, and saying it would earn a net profit of ¥60 billion, down from a previous expectation for a profit of ¥80 billion. It also lowered its operating-profit outlook to ¥270 billion from ¥300 billion.
The change stemmed from its decision to sell the group’s battery unit to Murata Manufacturing Co. for ¥17.5 billion, a deal the two companies expect to close by April.
Sony said the weak results were also partly due to a fall in the sale of smartphones, as well as a reduction in profits from sales of image sensors because of the strong yen. The sensors are a component for cameras in smartphones and are made in Japan but largely sold overseas.
The Japanese currency has risen this year from around ¥120 to the U.S. dollar in early January to around ¥104.9 to the dollar Tuesday. The image-sensor unit recorded a ¥4.2 billion operating loss in the quarter.
Sony also said damage to its factory in Kumamoto in southern Japan after an earthquake there in April hurt its profits, costing nearly ¥48 billion in the first half.
Write to Alexander Martin at
alexander.martin@wsj.com