Sony reports second-quarter earnings Wednesday, which are not looking favorable as worried consumers in the U.S. and Europe stopped short of shopping for flat-panel TVs, digital cameras and other gadgets in the face of looming financial uncertainty. The plunging dollar and euro are also eroding Sony’s massive overseas earnings when converted back into yen.
Osamu Hirose, analyst at Tokai Tokyo Securities Co., says investors fear worse news lies ahead for Sony, which may need a costly reshaping of its production to better protect against currency fluctuations. “There is no assurance that the numbers may get worse,” he said. “And tough times are expected for the year-end shopping season.” Analysts say that Sony loses more than 7 billion yen (US$70 million) for each 1 yen gain against the euro, and 4 billion yen (US$40 million) for each 1 yen gain against the dollar.
