Sony Leads Japanese Companies Releasing Earnings Next Week

After this past week’s stellar earnings from Apple Inc. (NASDAQ:AAPL) and Netflix, Inc. (NASDAQ:NFLX), many Japanese companies are set to announce earnings this week. Headlining this weeks earnings are Sony Corp. (NYSE:SNE). Sony’s earnings look like bad news for shareholders as the company has warned of a $1.2 billion net loss for the fiscal year ending in March.

Sony’s full year fiscal forecast came before Sony’s announcement earlier this month that it would take a 33 billion yen one time charge for the quarter after Sony Ericsson posted an unexpected loss for the quarter. One reason for Sony’s recent woes is currency exchange rates. The U.S. dollar remained below 80 yen for the quarter causing a rise in prices of the company’s exports compared to competitors in other countries. The massive flooding in Thailand last year also affected their results.

Other Japanese companies will also be affected by the same problems plauging Sony. Panasonic Corp. (NYSE:PC) will announce their earnings on Friday and is also expecting a fiscal year net loss. Panasonic is being weighed down by their television unit and costs from its subsidiary, Sanyo.

Other companies to watch this week for earnings include Toshiba Corp. (TYO:6502), Honda Motor Co. (NYSE:HMC), Sharp Corp. (TYO:6753) and Hitachi Ltd. (NYSE:HIT).

Global markets will be watching manufacturing data coming out of China closely this week. Many analysts are expecting the PMI’s to disappoint pointing to a reading of 48.8. A reading of 50 is the difference between contraction and expansion.

Sony Sells LCD Venture Stake To Samsung

Sony Corp (NYSE:SNE) will sell its LCD venture stake with Samsung Electronics to the company for $940 million as it tries to shore up losses in its TV business.

The venture cut its capital by 15% earlier this summer an industry sources had said Sony was negotiating an exit with the intent to switch to cheaper outsourcing for flat screens for their TVs. Meanwhile, Samsung will push ahead with next-generation displays.

“In terms of direction it is a positive (for Sony),” said Keita Wakabayashi, an analyst at Mito Securities in Tokyo, about the deal. “But if they are making a loss on the sale, one could ask why they didn’t make this decision sooner.”

“Their biggest problem is that they are not making a profit even though they don’t have many plants,” he said.

Sony warned last month of a fourth straight year of net losses with its TV unit losing $2.2 billion on falling demand and a surging yen.

Sony has been trying to strengthen their position in other markets as well including the smartphone market. Back in October, Sony took control of its mobile phone joint venture with Ericcson for $1.5 billion.

The company is hoping to take advantage of its music and video content and compatibility with TVs and tablet computers as it tries to catch up with market leaders such as Apple Inc. (NASDAQ:AAPL) and Google Inc. (NASDAQ:GOOG).

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