Sony Q2 Net Profit Plunges; Maintains Weak Forecast For Full Year

(RTTNews) - Japanese consumer electronics maker Sony Corp. (SON.L, SNE) on Tuesday affirmed its outlook for fiscal year ending March 31, 2017, expecting sharply lower profit and sales, after reporting sharp decline in second-quarter profit and revenues. The decline mainly reflected the impact of foreign exchange rates. On a constant currency basis, sales were essentially flat.

In pre-market activity on the NYSE, Sony shares were gaining 1.18 percent at $31.70.

For the full year, the company continues to expect attributable net income of 60 billion yen, and operating income of 270 billion yen. The company also affirmed its full-year outlook for sales and operating revenue of 7.4 trillion yen.

In the previous year, the company recorded attributable net income of 147.8 billion yen, operating income of 294.2 billion yen and sales and operating revenue of 8.11 trillion yen.

The company noted that the consolidated sales for the year are expected to remain unchanged primarily because decreased sales of the MC segment are expected to be offset by increased sales of the IP&S and other segments.

In its second quarter, net income attributable to stockholders fell 85.6 percent to 4.8 billion Japanese yen or $48 million from last year's 33.6 billion yen. Earnings per share dropped to 3.76 yen or $0.04 from 26.10 yen last year.

Income before income taxes decreased 31.7 billion yen to 40.5 billion yen or $401 million, and operating income declined 48 percent to 45.7 billion yen or $453 million.

The decline in operating income was mainly due to weakness in the Semiconductors and Components segments, partially offset by improvements in the Pictures and MC segments.

Sales and operating revenue for the quarter declined 10.8 percent to 1.69 trillion yen or $16.72 billion from 1.89 trillion yen a year ago.

Mobile Communications sales decreased 39.6 percent, mainly due to a reduction in mid-range smartphone unit sales and lower smartphone unit sales in unprofitable regions where downsizing measures were implemented.

Game & Network Services sales were hurt by a price reduction for PlayStation4 hardware, partially offset by an increase in PS4 software sales including sales through the network. Imaging Products & Solutions sales were hurt by lower sales of Still and Video Cameras, primarily reflecting a contraction of the market and the difficulty of procuring components due to the 2016 Kumamoto Earthquakes.

Home Entertainment & Sound sales and Components sales also were lower.

However, Pictures sales increased 4.6 percent year-on-year or a 25 percent increase on a U.S. dollar basis, due to higher sales for Motion Pictures, Television Productions and Media Networks.

Music sales benefited by an increase in sales of Visual Media and Platform as well as Recorded Music. Financial services revenue increased 23.6 percent primarily due to a significant increase in revenue at Sony Life.