Sony operating profit seen jumping 80% this fiscal year
$4.5bn-plus figure would approach company record
TOKYO -- Sony's group operating profit is expected to rise around 80% in the year ending March 2018 on the back of robust electronics operations, offsetting the impact of numerous obstacles in fiscal 2016.
The Japanese electronics and media giant could log around 500 billion yen ($4.58 billion) in black ink, nearing the 525.7 billion yen record set in fiscal 1997.
Plans targeting a fiscal 2017 profit of more than 500 billion yen were sketched out in a corporate strategy unveiled in February 2015. But fiscal 2016 proved a year of setbacks. A major earthquake that rocked southern Japan last April disrupted a Kumamoto Prefecture plant making CMOS image sensors, a key Sony earner used in smartphone cameras. And this January, the company announced more than 100 billion yen of impairment losses in the movie production business.
Globally competitive offerings are expected to drive significant earnings growth this fiscal year. Demand for smartphone image sensors is on the rise, along with sales of the PlayStation 4 game console. Pricey ultrahigh-definition 4K televisions and digital single-lens reflex cameras will provide further support.
Sales of Sony's Xperia smartphone line are seen ending their slide. This is good news for the mobile communications segment, which logged more than 200 billion yen in red ink for fiscal 2014. A shift toward offerings with higher added value and cost-cutting efforts are thought to have lifted that business into the black last fiscal year and look to do so again. The company is set to maintain the 500 billion yen-plus target for operating profit, reassured by solid foundations for its core electronics business.
Sony upgraded fiscal 2016 forecasts Friday. It now expects an operating profit of 285 billion yen, down 3% from a year earlier on factors including the Kumamoto temblor. But this is still 45 billion yen more than predicted in February, thanks to cost-cutting in such operations as financial services. Net profit is seen down 51% at 73 billion yen -- 47 billion yen more than previously forecast.
Fiscal 2016 earnings and current-year projections are due out April 28.