A 29% drop in profits for the Japanese tech giant

Japanese electronics giant Sony on Thursday reported a 29% drop in operating profit for the fiscal second quarter, hit by weakness in its imaging sensor – or chip – business..

Here’s how Sony performed in the September quarter against LSEG consensus estimates:

• Revenue: 2.8 trillion yen ($18.5 billion) vs. 2.87 trillion yen expected. This represents an increase of 8% per annum.
• Operating profit: 263 billion Japanese yen versus 304.4 billion yen expected. This represents a year-on-year decline of 29%.

Sony attributed the significant drop in profit to weakness in its imaging sensor business and lower profits in its financial services and entertainment, technology and services businesses.

The company said profits in its chip division fell more than 28% in the fiscal second quarter.

Sony supplies camera chips to consumer technology manufacturers like Apple, which use semiconductors in its iPhones.

Despite the decline in profits, the company raised its sales forecast for the full year, expecting total sales of 12.4 trillion yen (previous forecast 12.2 trillion yen) as it now benefits from positive foreign exchange rates.

The Japanese yen has weakened significantly against the dollar, and Sony generates most of its revenue outside the US.

Thursday’s results followed a fiscal first quarter in which Sony reported a 33% year-over-year rise in revenue to 3 trillion Japanese yen, but a 31% year-over-year profit drop to 253 billion yen. At the time the company cited weakness in its financial services and films divisions, which saw a slight decline on the back of strikes by the Writers Guild of America and other unions against the use of artificial intelligence to develop movie scripts.

This is a developing story and will be updated soon.