Page last updated at 08:36 GMT, Tuesday, 29 July 2008 09:36 UK

Sony sees sharp fall in profits

Sony chief executive Howard Stringer at Thursday's news conference
Sony said its games business performed well

Quarterly profits at Japanese electronics giant Sony have almost halved, hurt by a loss at its mobile phone venture with Sweden's Ericsson.

The PlayStation maker said that net profit totalled 35bn yen ($326m, 163m) in the April to June period, down from 66.5bn yen a year ago.

Sony was rattled by a strong yen and stiff price competition, although PlayStation sales were strong.

The company also trimmed its annual profit forecast.

"Games have recovered well - that's positive. But movies aren't good. Then Sony Ericsson is really a drag," said Hiroaki Osakabe, a fund manager at Chibagin Asset Management.

Sony said its net profit in the year to March 31, 2009 would total 240bn yen, down from an earlier forecast made in May of 290bn yen.

It said it expected weak results from the Sony Ericsson mobile phone venture, which has faced declining demand for its more expensive phones.

Mixed performance

Japan's electronics makers have seen mixed performances as they grapple with a US economic downturn, higher fuel and raw material prices, and a stronger yen - although the Japanese currency has begun to weaken recently.

Toshiba, which makes the memory chips used in digital cameras and mobile phones, said it made a net loss of 11.6bn yen in the quarter due to slump in semiconductor sales. It also blamed a stronger yen.

However, Matsushita, behind the Panasonic brand, said its net profit jumped to 73bn yen in the first three months of the financial year, up 86% compared with the same period a year ago, helped by brisk sales of large flat-screen televisions.

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