Sony cuts profits forecast by 57%

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Sony cuts profits forecast by 57%

Paul Kunert

Fierce pricing pressure and a stronger yen have led Sony to slash its profits forecasts for the year by 57%.

The consumer electronics leviathan is the latest vendor to succumb to tough market conditions as it said operating profits expected to be 200bn yen (£1.25bn) to 470bn yen.

"We expect the results of certain businesses in the Electronics segment, such as LCD, television, compact digital cameras and video camera businesses to be lower than the previous forecast," Sony said.

This was due to "deterioration in the market environment brought on by the slowing global economy and an intensification of price competition," the company added.

Figures for Sony's second quarter ended 30 September 2008, revenues declined 1% year-on-year to a little over 2trn yen and profit fell72% to 73.7bn yen.

A spokesman for the Japanese government said today it needed to place close attention to the rise of the yen against other western currencies and its impact on the economy.

This week the yen has hit a six year high versus the Euro and a 7 month against the dollar.

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