Electronics giant Sony's PlayStation 3 may be "out of the woods," according to CEO Sir Howard Stringer, but currency woes mean that the company has had to slash its profits forecast for the financial year ending March 31.
According to Bloomberg, operating profit will be ¥410 billion (approximately $3.85 billion), below the five-percent margin that Sony had previously targeted. It is also significantly less than the ¥444.7 billion ($4.17 billion) previously estimated by an average of 19 analyst predictions by the Bloomberg news service.
The reasoning behind the cut is the stronger yen and softening US demand for Sony products due to the fallout from the subprime mortgage market. At a press briefing held in Tokyo, Sony chief financial officer Nobuyuki Oneda told reporters, "The subprime problem didn't have much impact on our year-end sales, but it may start affecting sales toward the spring. We cannot rule out the possibility that consumer spending in the US may be hit."
Bloomberg also later updated its story to state that Sony has also now abandoned Stringer's pledge to raise profitability to the highest level in nine years by the end of March. Oneda also added that an exchange-rate change of a single yen to the dollar affects Sony's operating profits......
