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Sony increases profit predications as sales of image sensors soar

By Charlotte Ricca

Image sensor sales so good, the electronics company can’t keep up with demand

Sony has increased its annual profit forecast, thanks to a huge rise in sales of image sensors for smartphones.

Sony was predicted by analysts to see a third-quarter profits of 271.07bn yen ($2.48bn, €2.25bn, £1.91bn), down from 376.99bn yen in the same period a year earlier. However, profit rose 6 per cent to reach 300.1bn yen, as it’s sensor business continues to thrive in a highly competitive market.

As a result, the Japanese electronics company raised its annual profit forecast to 880bn yen from 840bn yen. This is just above the 878.47bn yen predicted by 22 analysts.

Kenichiro Yoshida, who became chief executive in 2018, is investing heavily in the image sensor division, as customers like Apple add more cameras to their phones.

Since his appointment, Sony’s share price has spiked by more than 40 per cent.

Sony currently produces around half of the world’s image sensor market, and profits soared to 75.2bn yen from 46.5bn yen in the same period last year.

Sales are so good, the electronics company can’t keep up with demand, chief financial officer Hiroki Totoki told a press conference in Tokyo. He said that the company “haven’t been able to stock up inventories we had hoped for”.

It’s not all good news, however, as Sony’s gaming business saw profit fall to 53.5bn yen from 73.1bn yen, as sales of its PlayStation 4 console continued to decline.

Sony lowered its full-year sales outlook for the business about three per cent to 1.95 trillion yen and cut its operating profit target by about two per cent.

The PlayStation 5, which is scheduled for release this year, will feature a number of improvements including better graphics and advanced haptic controllers.

At the press conference Totoki was asked if the coronavirus would affect business, as many of their components are made in China. Totoki said it depends on the severity of the outbreak, but admitted the impact could be “significant enough to force us to roll back” the comapny's profit forecast.

FURTHER READING: Sony to test self-driving cars

FURTHER READING: Apple shares surge as holiday sales beat market predictions

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