Earthquake sends shockwaves through Sony's results

Sony has forecast full-year results that will not meet analysts’ expectations, partly because of the costs related to a Japanese earthquake. However, smartphone component demand also dropped.

Game division continues to perform well

Previously, Sony predicted it would have its most profitable year in the past 2 decades, but that came to an abrupt end when it had to repair a production facility after a damaging earthquake.

Sony’s turnover will drop 3.8 % to 7.8 billion yen (63.6 billion euro), while net profit will drop 46 % to 80 billion yen (652 million euro), a lot lower than what analysts had predicted, namely a 196 billion yen (1.6 billion euro) profit.

Smartphone component demand also dropped, partially because of slower iPhone growth. It is the first time since 2007 that the smartphone market’s growth has slowed down and Sony immediately notices that in its turnover and profit.

However, its gaming division continues to thrive, with an expected profit growth to 135 billion yen (1.1 billion euro). Thanks to the introduction of its virtual reality headset, called PS VR, Sony hopes it can continue to improve its results in 2016.