Sony raises profit view as videogame sales herald turnaround
TOKYO (Reuters) - Japanese consumer electronics firm Sony Corp <6758.T> raised its earnings estimates for the second time in three months on Wednesday, citing higher than expected sales of video games and digital cameras.
Sony said it probably made an operating profit of 68 billion yen ($569 million) in the year ended March 31, compared with 26.5 billion yen a year earlier. That compares with its previous estimated operating profit of 20 billion yen.
The Tokyo-based firm is finally reaping the benefit of restructuring efforts after weak TV and smartphone sales brought years of heavy losses. After massive cost cuts, it has sought targeted expansion under Chief Executive Kazuo Hirai in lucrative areas such as sensors for smartphone cameras.
Sony is set to make its official earnings statement for the year on April 30. Before Wednesday's move, following an upward revision in February, the average forecast among 19 analysts for operating profit was 50.3 billion yen.
As part of its restructuring, Sony has spun off its TV business. It also plans to split off its audio and video business as part of a new strategy to encourage greater autonomy among its subsidiaries.
The company had struggled to gain market share in high-end smartphones, lagging far behind leaders Apple Inc and Samsung Electronics Co Ltd <005930.KS>.
Sony on Wednesday also narrowed its overall net loss estimate to 126 billion yen from 170 billion yen, and raised its revenue estimate to 8.2 trillion yen from 8.0 trillion yen.
It cited strength in its financial services unit, saying the stock market's rise helped to bolster the finances of its life insurance division.
Its shares have risen more than 30 percent so far this year on signs of progress toward a long-awaited turnaround. Year-on-year, the shares have nearly doubled, hitting 3,827.50 yen earlier this month, their highest since 2008.
Jefferies reiterated its "buy" rating on the shares, with a price target of 5,000 yen, citing strong sales of PlayStation 4.
($1 = 119.5700 yen)
(Reporting by Ritsuko Ando and Chris Gallagher; Editing by Kenneth Maxwell and Keith Weir)
