Japan's tech firms retain profit goals
Source: Agencies |
July 29, 2011, Friday
|
Print Edition
Print Edition
JAPAN'S top consumer electronic firms recovered faster than expected from March's earthquake, allowing most of them to maintain full-year profit forecasts despite a weakening TV market and concerns about the outlook for the global economy.
Video game maker Nintendo Co was a standout disappointment as it unexpectedly swung to a quarterly operating loss, hit by sluggish sales of its 3DS handheld game player and a strong yen. It also cut full-year forecasts to far below market expectations.
Sony Corp and Panasonic Corp warned of weak TV sales, following Philips and Corning Inc in highlighting sluggish demand.
Global consumer confidence fell in the second quarter to its lowest level in 18 months as an uncertain economic outlook, a deepening eurozone debt crisis and rising inflation made people cautious, a Nielsen survey showed.
"Sony, Panasonic and many other Japanese tech firms are still hoping they can swing to profits in the rest of the calendar year," Said Derek Lin, manager of the Asia-Pacific Fund of Uni-President Asset Management in Taipei. "The worst of their stock price declines is over, but how far they can come back up depends on demand from US and European markets."
Over the past several years, Japanese companies have increasingly lost market share in televisions, flat screens and chips to South Korean companies such as Samsung Electronics and LG Display, partly helped by heavy investments and faster execution under family-controlled groups.
Japanese electronics conglomerates have forecast annual earnings for the year to March 2012 to remain flat or dip slightly, underscoring a strong comeback from the disaster-related production difficulties in Japan.
However, doubts about the prospects for the rest of the year are creeping due to the yen's renewed rise against the dollar and the euro.
Sony, the maker of Bravia TVs and PlayStation game consoles slashed its annual forecast for LCD TVs to 22 million sets from 27 million. Only a better-than-anticipated performance by other units including digital cameras kept the company from cutting its profit outlook.
"The LCD market itself is becoming weaker, so it is not that surprising that it had to reduce its LCD television sales forecast," said Shigeo Sugawara, senior investment manager at Sompo Japan Nipponkoa Asset Management. "What it plans to do with this division is vital," he said.
Video game maker Nintendo Co was a standout disappointment as it unexpectedly swung to a quarterly operating loss, hit by sluggish sales of its 3DS handheld game player and a strong yen. It also cut full-year forecasts to far below market expectations.
Sony Corp and Panasonic Corp warned of weak TV sales, following Philips and Corning Inc in highlighting sluggish demand.
Global consumer confidence fell in the second quarter to its lowest level in 18 months as an uncertain economic outlook, a deepening eurozone debt crisis and rising inflation made people cautious, a Nielsen survey showed.
"Sony, Panasonic and many other Japanese tech firms are still hoping they can swing to profits in the rest of the calendar year," Said Derek Lin, manager of the Asia-Pacific Fund of Uni-President Asset Management in Taipei. "The worst of their stock price declines is over, but how far they can come back up depends on demand from US and European markets."
Over the past several years, Japanese companies have increasingly lost market share in televisions, flat screens and chips to South Korean companies such as Samsung Electronics and LG Display, partly helped by heavy investments and faster execution under family-controlled groups.
Japanese electronics conglomerates have forecast annual earnings for the year to March 2012 to remain flat or dip slightly, underscoring a strong comeback from the disaster-related production difficulties in Japan.
However, doubts about the prospects for the rest of the year are creeping due to the yen's renewed rise against the dollar and the euro.
Sony, the maker of Bravia TVs and PlayStation game consoles slashed its annual forecast for LCD TVs to 22 million sets from 27 million. Only a better-than-anticipated performance by other units including digital cameras kept the company from cutting its profit outlook.
"The LCD market itself is becoming weaker, so it is not that surprising that it had to reduce its LCD television sales forecast," said Shigeo Sugawara, senior investment manager at Sompo Japan Nipponkoa Asset Management. "What it plans to do with this division is vital," he said.
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