Sharp Posts Profit for First Time in Two Years, but Copier/MFP Profit, Sales Decline

On February 3rd, Japan’s Sharp Corporation raised its earnings forecast for its full-year after reporting its first quarterly profit in over two years.

Sharp, which last year was acquired by Taiwan’s Foxconn, raised its operating profit forecast to 37.3 billion yen ($329.85 million) for its fiscal year that will end on March 31, 2017. Sharp had previously forecast 25.7 billion yen in profits

For its latest quarter of October to December 2016, Sharp posted net profit of 4.2 billion yen, versus a 24.7 billion yen loss for the same quarter a year earlier. Previously, the last time Sharp had posted a profit was for its July-to-September 2014 quarter.

Sharp’s return to profitability is attributed to Foxconn’s cost-cutting, as well as to Foxconn’s parts-procurement power

Sharp’s sales for the quarter, however, totaled 571.5 billion yen, down 13.8 percent year-over-year. Sharp says that this was due mainly to a shift to a brand-licensing business for LCD TVs in the Americas, and to a downturn in demand in LCD TV panels and camera modules among customers. However, it says reforms contributed to improvement in earnings.

Business Solutions Group

Within Sharp’s Business Solutions Group, sales totaled 72.3 billion yen, down 18.6 percent versus the same quarter a year earlier. Operating income for the quarter was 4.1 billion yen, down 41.5 percent versus 7.1 billion yen for the same quarter a year earlier.

For the first half of its current fiscal year, Sharp reported 57.8 billion yen in sales of copier/printers, compared to 78.2 billion yen for the first half of its previous fiscal year, and 58.8 billion for the second half of its previous fiscal year.

Sales of copier/printers were at its lowest in Sharp’s latest quarter – totaling 24.1 billion yen – compared to its past six consecutive quarters.

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