SONY

Sony prepares for lower profit in 4 years after coronavirus impact

Sony expects operating profit to drop by at least 30% this fiscal year to the lowest level in four years, as the company anticipates an impact on demand for smartphones TVs, cameras and image sensors on account of the coronavirus pandemic.
Sony halted production at some factories and suffered supply chain disruptions as governments around the world imposed long restrictions on movement and commercial activities to contain the virus.
Sony's financial vice president, Hiroki Totoki, said the consumer electronics sector, such as TVs, "has been hardest hit at the moment, but the impact will also expand to other businesses."
The electronics and entertainment company had a 57% drop in operating profit in the quarter ended in March, to 35.45 billion yen ($ 331 million), below the average of 73.77 billion yen in analysts' estimates, from according to data from Refinitiv.
Sony did not provide accurate forecasts for the current fiscal year that started in April, but Totoki said that current calculations show that profit is expected to fall "at least about 30%" from 845.46 billion yen a year earlier.
The predicted profit of less than 600 billion yen would be the lowest since the year ended in March 2017, when earthquakes closed factories in southern Japan that produce image sensors.
The impact of the virus has already reduced the group's operating profit by 68.2 billion yen in the year ended in March, Sony said.
A positive point for the company was the video game unit, which had a lower than expected profit decline in the fiscal year. The deal had a positive impact of 2.8 billion yen with the pandemic, as consumers trapped at home sought entertainment, spending more time playing games.
Sony is due to launch the PlayStation 5 later this year, seven years after the launch of the PS4 console.
Sony reiterated the year-end schedule for the PS5 launch, denying media speculation that the coronavirus would impact production and cause a major delay in the company's new generation console. The company, however, was forced to announce delays in major games such as "The Last Of Us Part II".

by Makiko Yamazaki