Sony posts sharp drop in first-half net profit

TOKYO: Sony Corp said yesterday that half-year net profit fell nearly 15% but it upgraded its annual forecast on solid growth in its image-sensor and music sectors.

The PlayStation manufacturer said net profit dropped 14.9% to 340 billion yen ($3.12 billion) for April-September, and tipped annual net profit of 540 billion yen, compared with an earlier 500 billion yen forecast.

The company said it saw sales jump in the image-sensor sector, thanks to a growth in demand due to mobile phones.

“Sales of image sensors remain strong. Demand for image sensors is expected to grow further as high-spec smartphones equipped with multiple lenses are getting more popular,” Hideki Yasuda, an analyst at Ace Research Institute in Tokyo, told AFP before the results were announced.

The Nikkei business daily reported yesterday that Sony planned to build a new image sensor plant in southern Nagasaki prefecture.

Sony currently operates four image sensor plants in Japan and is looking to increase production capacity by March 2021.

“We’re considering the plan to build a new plant in Japan,’’ Sony spokesman Takashi Iida told AFP, but said nothing had been decided yet.

Last week, the CEO of US hedge fund Third Point, which holds a key stake in the Japanese conglomerate, reportedly expressed frustration at its rejection of a proposal to spin off its semiconductor operations including image sensors.

Sales for Sony’s music business also rose, the firm said yesterday, helped by its integration of EMI Music Publishing and an increase in streaming revenues.

Sony’s half-year sales dipped 2.1% to 4.04 trillion yen while operating profit jumped 17.3% to 510 billion yen.

Sony has spent years struggling to recover from deep financial trouble, a process that entailed aggressive restructuring, the loss of thousands of jobs and the sale of business units and assets.

It has seen a slowdown in its games and network businesses, and has said it expects revenue from the core sector to sag owing to a continued fall in game hardware sales, and the cost of developing a next-generation console.

In the six-month period, the company posted a drop in sales for the sector, citing a decline in both software and PlayStation 4 hardware sales.