TOKYO, April 11 Shares of Sony Corp and
Sharp Corp plunged on Wednesday after the TV makers
flagged a combined 900 billion yen ($11 billion) in full-year
net losses, highlighting the crumbling of earnings in Japan's
once-mighty electronics industry.
Japanese firms such as Sony that once dominated the consumer
electronics landscape have been increasingly outgunned by more
innovative rivals such as Apple Inc and Samsung
Electronics, with a strong yen and tumbling TV
prices only adding to the pain.
Their current predicament could ironically draw some
parallels to their 1980s heyday, when previously dominant U.S.
consumer electronics makers such as Zenith struggled to make
money amid low TV prices and were overtaken by a more
cost-efficient Japan Inc. Now, it is South Korean firms Samsung
and LG Electronics that have taken the baton.
The focus now shifts to what steps they can take to turn the
tide, with Sony's new CEO Kazuo Hirai set to lay out his revival
strategy in more detail at a briefing on Thursday. Media reports
this week said Sony planned to cut 10,000 jobs as part of its
"We like the way it has taken steps to eliminate issues of
concern as part of moves to deliver a reborn Sony," Nomura
Securities said in a report. "We still regard downsizing and
product strategies worthy of the Sony brand as indispensable
preconditions of any share price upside."
Sony on Tuesday said it expected a record net loss of 520
billion yen for the fiscal year ended March 31, more than double
its previous estimate and its fourth straight year in the red,
as the company writes off deferred tax credits due to the
company's consistent losses.
Aquos TV maker Sharp deepened its full-year net loss
forecast to 380 billion yen from 290 billion yen.
Together with Panasonic Corp's forecast for a 780
billion yen net loss in the just-ended fiscal year, the three
Japanese TV manufacturers expect to have lost 1.68 trillion yen
($20.76 billion) - roughly the size of Sony's entire market
value, according to Thomson Reuters data.
Sony shares were down 6.1 percent at 1,490 yen after hitting
a two-month low of 1,473 yen soon after the open. Sharp was 3.4
percent lower at 512 yen.