More NewsMoody’s Cuts Sony Credit Rating to Junk

Moody’s Cuts Sony Credit Rating to Junk

Japan’s Sony Corporation has its credit rating cut to junk by Moody’s Investors Service as the tech giant attempts to stabilise falling sales for its consumer electronic products.

The credit ratings agency (CRA) lowered its rating to Ba1, one level below investment grade, from Baa3 and the outlook is stable, Moody’s said in an e-mailed statement. Sony already received a similar rating from Fitch in 2012, while Standard & Poor’s (S&P) has the company on the second-lowest investment grade.

“Sony’s profitability is likely to remain weak and volatile,” Moody’s said in the statement. “We expect the majority of its core consumer electronics businesses – such as TVs, mobile, digital cameras and personal computers – to continue to face significant downward earnings pressure.”

“There are some very good products coming out,” said Maki Hanatate, Moody’s senior credit officer, who cited positive feedback on the group’s Xperia smartphones and QX lens cameras. “But it’s uncertain how long it can maintain its competitiveness with so many other rivals rolling out various products.”

Many analysts expect Sony to lower its full-year profit guidance when it announces earnings on 6 February. Bank of America Merrill Lynch (BofA Merrill), for example, estimates Sony’s annual net profit at 17bn yen (JPY) compared with the corporation’s target of JPY30bn (US$290m).

Related Articles

Infosys Finacle to power Santander UK’s international cash management system

More News Infosys Finacle to power Santander UK’s international cash management system

2m The Global Treasurer
Preparing for GDPR? Here’s four things to consider

More News Preparing for GDPR? Here’s four things to consider

5m Elliott Wiseman
Cash flow in focus for investors

Cash Management Cash flow in focus for investors

6m Conor Deegan
Treasury TV: Karen Pugsley, Domino's Pizza Group

More News Treasury TV: Karen Pugsley, Domino's Pizza Group

6m Victoria Beckett
Treasury TV: Yeng Butler compares US and European MMF reforms

Compliance Treasury TV: Yeng Butler compares US and European MMF reforms

6m Victoria Beckett
Treasury TV: Tim de Knegt, The Port of Rotterdam

10 Minutes With The Treasury Treasury TV: Tim de Knegt, The Port of Rotterdam

6m Victoria Beckett
Banks are selling clients short with short dated cash deposit U-turns

Banking Banks are selling clients short with short dated cash deposit U-turns

6m Victoria Beckett
What does sterling’s Brexit boost mean for UK manufacturers?

More News What does sterling’s Brexit boost mean for UK manufacturers?

7m Tasja Botha