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Sony Reports Drop in 2nd Quarter Profits


The latest earnings report from Japanese entertainment and electronics giant, Sony, is proof that cheap competitors continue to cut into its market share. Sony's profits for the second quarter fell 25 percent to $300 million compared to the same period last year.

Sony says weak sales of its video game consoles, DVD players and losses from its movie studios hurt results. Sales of digital cameras and cell phones were healthy, but because Sony slashed prices to gain more market share, revenue actually fell.

As part of a turnaround strategy, Sony is expected to announce within days an alliance with South Korea's Samsung Electronics.

In other earnings news, Yahoo Japan, the country's leading Internet portal, says profits more than doubled in the second quarter. They came to $54 million, boosted by steady growth in online auctions and brisk advertising sales.

Yahoo Japan's President Masahiro Inoue said his company will also try to attract more investors by moving its shares to the main Tokyo Stock Exchange from a smaller market. He said trading will begin on October 28, and he pledged to further improve the company's performance.

Meanwhile, business leaders say Japan's economy is getting healthier.

A poll conducted this month by the Asahi newspaper shows nine out of 10 executives surveyed say the economy has either bottomed out or is recovering after three recessions in a decade.

But a majority of respondents agree that the recent appreciation of the Japanese currency worries them since it is likely to hurt exports by making them more expensive for overseas buyers.

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