Already a Bloomberg.com user?
Sign in with the same account.
Sony Corp. (6758), the Japanese electronics maker which cut its profit-forecast, had its credit ratings put on review for a possible downgrade by Moody’s Investors Service because of weak consumer demand and a stronger yen.
Sony’s Baa1 long-term rating and Prime-2 short-term rating may be lowered after assessing the Tokyo-based company’s ability to restore its earnings and financial strategy, Moody’s said in a statement today. Baa1 is the third lowest among Moody’s 10 measures of long-term investment grades and Prime-2 is the middle of its three short-term investment scales.
The maker of Cyber-shot cameras and Bravia televisions had its long-term rating already cut one level by Moody’s in January and by Standard & Poor’s in the following month. Deterioration in the TV business led Japan’s three largest TV makers including Panasonic Corp. (6752) and Sharp Corp. to post their biggest annual losses in the year ended March 31.
Sony’s TV and mobile-phone businesses “continue to be plagued by structural challenges, such as the commoditization and maturity of major products, rapid technological changes, and intense global competition,” Moody’s said in the statement. “Sony has not been able to deal with these issues effectively.”
Last month, Sharp had its long-term credit rating put on review for a possible downgrade at S&P, which cited weak demand and prices for flat panel TVs. Sharp’s credit is currently rated at BBB+, the third lowest among 10 investment scales by S&P.
Sony shares, which have lost 35 percent of their value this year, closed unchanged at 897 yen in Tokyo trading.
On Aug. 2, Japan’s biggest consumer electronics exporter, reeling from four consecutive annual losses, cut its full-year profit forecast to 20 billion yen ($255 million) in the year ending in March from its previous projection for 30 billion yen.
To contact the reporter on this story: Mariko Yasu in Tokyo at email@example.com
To contact the editor responsible for this story: Michael Tighe at firstname.lastname@example.org