Tokyo: Sony Corp will likely fall slightly short of its target to boost LCD TV unit sales by 60% this financial year, an executive said on Monday, helping push the electronics maker’s shares down 1%.
Sony executive deputy president Hiroshi Yoshioka told a group of reporters that Sony would struggle to make the TV division profitable this year and that he was not expecting substantial profits from the operations in the next financial year.
After losing money on televisions for the past 6-year, Sony has been hoping that the introduction of 3D and Internet-capable models would help it lift sales of LCD TVs to 25 million in the year to March 2011, and make the business profitable.
Last week the largest US electronics retailer, Best Buy Co Inc, surprised investors by reporting a drop in quarterly sales at existing stores. It said that sales of 3D TVs had fallen behind industry expectations.
“There are some who are worried about how much content has been prepared and others who mistakenly assume that 3D TVs can only show images in 3D,” Yoshioka said.
Shares of Sony were down 1% at ¥2,934 in afternoon trade in Tokyo. The Nikkei average fell 0.8%.
“The news about not meeting the sales target is having an impact on the share price, along with a slightly stronger yen to the dollar,” said Tomomi Yamashita, fund manager at Shinkin Asset Management.
Yoshioka, who is in charge of Sony’s TV, digital camera and electronic device operations, said that holiday sales were in line with overall expectations, with growth strong in emerging markets and demand in developed economies flat year-on-year.
Yoshioka said Sony was still in talks with Sharp Corp on whether it would raise its stake in a state-of-the art TV panel plant in Sakai, western Japan.
Media reports have said that Sony is set to drop a plan to raise its investment in the joint venture to 34% as it seeks lower-cost panel suppliers in other parts of Asia.