Operating loss of 11.7 billion yen (97 million U.S. dollars) was recorded, compared to an operating income of 53.8 billion yen in the same quarter of the previous fiscal year. This significant deterioration was primarily due to the deterioration in the operating results of the battery business, including the recording of a 30.6 billion yen (255 million U.S. dollars) impairment charge related to long-lived assets, increases in depreciation and amortization expenses as well as in research and development expenses for image sensors and camera modules, and the impact of the decrease in sales of image sensors."
Sony also revises its future sales forecast:
"Sales are expected to be lower than the October forecast primarily due to significantly lower than expected sales of image sensors and camera modules, reflecting a decrease in demand for mobile products and lower than expected sales in the battery business. The forecast for operating income is expected to be significantly lower than the October forecast primarily due to the impact of the above-mentioned decrease in sales and the recording of an impairment charge related to long-lived assets in the battery business during the current quarter.
Sony is currently formulating its business plan for all of its business segments for the fiscal year ending March 31, 2017. With regard to the camera module business, there is a possibility that factors such as a decrease in projected future demand, which caused a downward revision in the forecast for the current fiscal year for the business, could continue to have a negative impact on the business going forward. It is therefore possible that the above-described business environment might result in an impairment charge against long-lived assets in the camera module business."
Update: Few more slides from the Sony earnings webcast:
The webcast gives quite many details and explanations on the image sensor and camera module business, starting from time 6:49 to 12:26. In Q&A #1, Sony says that it expects the business recovery to start in Q1 next fiscal year, beginning in April 2016.
How about OVT business evolution at the same period please?
ReplyDeleteIphone sales low --> sony sensor sales low. These results are no surprise for me..
ReplyDeleteAs for me, I'm surprised how quick Sony market dynamics has changed. Just in July 2015, Sony reported a huge increase in image sensor sales - 62% YoY:
ReplyDeletehttp://image-sensors-world.blogspot.com/2015/07/sony-reports-another-increase-in-image.html
Then, in October 2015, Sony again reports a nice sales growth of 22% YoY, but warns of "a temporary decrease in image sensor production due to a production equipment problem" and says that the issue has been already solved:
http://image-sensors-world.blogspot.com/2015/10/sony-reports-qoq-image-sensor-sales.html
And now, all of the sudden, we see 17% YoY sales drop and a lower forecast. I would expect something line a growth slowdown, then few flat quarters, then few percent drop. So quick transition from two digit growth to two digit drop and low forecast was totally unexpected for me.
This business is more and more like DRAM now.
ReplyDeletesingnificant -> significant
ReplyDeleteThanks, fixed.
DeleteMy guess is that Apple has its suppliers "own" the inventory until the moment that it goes into a phone (I've seen areas in assembly areas that "belonged" to vendors and it wasn't until a crate moved over a taped line on the factory floor that it was billed and invoiced). So an Apple slowdown would hit the supply chain immediately, rather than a quarter or two, especially if Apple had inventory already built, so it would trickle up the supply chain immediately.
ReplyDeleteI think
I know of one large motor manufacturer that does exactly this. Only once the part is assembled onto the car and scanned is it registered as purchased. They call it self billing and they (the customer) print out the suppliers own statement for them. You have to be a pretty big player to do this as its an accounting nightmare for the supplier but Apple certainly qualifies here.
DeleteIt is time for lay off at Sony !
ReplyDeleteQuick !