Sony Q3 Results Show Some Recovery Despite Yen

TOKYO (01/20/2000) - Sony Corp. today announced consolidated results for the third quarter of the current fiscal year ended Dec. 31, 1999. While the results were below those reported in the same period a year earlier, they point to a slight recovery of prospects at the company during its most important fiscal quarter.

Sony said the results were better around the world on a local currency basis but, due to the strength of the Japanese yen, were below those of a year ago when converted to yen. During the quarter, the yen rose around 15 percent in value.

Despite this, in the core electronics sector, the company said sales increased 2.3 percent to 1,310.6 billion yen (US$12.36 billion) to compise 68.4 percent of all revenue at the company. Sales of digital video cameras, DVD players and digital still cameras were particularly strong. Sales of information and communications equipment jumped 9.8 percent on the back of higher sales of personal computers, CD-R and CD-RW drives.

In the games sector revenues dropped 23.5 percent to 240.3 billion yen as sales of the PlayStation console slowed ahead of the upcoming Japanese launch of PlayStation 2. Due March 4 in Japan, that should boost games sales in the fourth quarter of the financial year. Sony said PlayStation shipments worldwide totaled 6.6 million in the period against 7.6 million in the same quarter a year earlier.

Overall, revenue was 1,916.0 billion yen, down 1.8 percent on the third quarter of the previous fiscal year. On the back of the lower revenue, operating income slipped 10.2 percent to 164.2 billion yen and pretax income was down 29.6 percent to 165.9 billion yen. Net income was 93.6 billion yen, a 16.6 percent drop on the third quarter of 1998.

The falls were lower than those recorded over the first nine months of the year. Revenue is so far down 5.5 percent to 5,031.0 billion yen, operating income is down 28.6 percent to 276.6 billion yen, pretax income is down 30.7 percent to 298.6 billion yen and net income is off 20.1 percent at 158.6 billion yen.

By region, Sony saw Japan sales rise 7.0 percent to 577.0 billion yen thanks to the slowly recovering local economy and absence of exchange rate adjustments.

Sony's U.S. sales dropped 3.7 percent in yen terms to 588.9 billion yen and those in Europe fell 12.5 percent to 461.2 billion yen. Sales in other regions of the world climbed 5.8 percent to 288.8 billion yen in the quarter.

Looking ahead, the company said it expects losses in the fourth quarter.

Without releasing new estimates, the company said it expects to see for the full year to March 31, 2000, operating income slightly lower than previously forecast with pretax income and net income coming in slightly higher.

Announcing full year results last year, Sony predicted sales of 6,500 billion yen, operating income of 240 billion yen, pretax income of 210 billion yen and net income of 110 billion yen.

Sony Corp., in Tokyo, can be found online at http://www.sony.co.jp/.

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