Upbeat profit outlook at Sony

City A.M. Reporter
SONY’S forecast of its first annual net profit in four years is being viewed as optimistic, as the consumer electronics giant struggles with the aftermath of the March earthquake and a series of network security breaches.

Havoc to supply chains and the physical damage caused by Japan’s earthquake and tsunami forced Sony earlier this week to take a charge on tax credits that resulted in a $3.2bn (£2bn) net loss for the business year just ended, its biggest deficit since 1995 and the second worst on record.

Sony yesterday predicted an 80bn yen net profit for the year that started 1 April, compared with analysts’ consensus of 105bn yen.

It expects to make an operating profit of 200bn yen this business year, reiterating guidance given earlier in the week, which helped its shares rise.

“Looking at its forecast, it appears Sony is expecting a recovery in the latter half of the year, which is a bullish forecast, but there’s a lot of uncertainty and there is a risk it comes in below that expectation,” said Koji Takeuchi, senior economist at Mizuho Research Institute.