Pioneer has decided the plasma TV market is to competitive and will be halting all internal production of plasma displays. The company will not be leaving the industry however and will instead get plasma panels from Matsushita.
Currently pioneer is the 5th largest plasma TV producer and is losing money on its plasma division. Actually, Pioneer is “expected to report a loss of 10 billion yen or about $96 million USD for the fiscal year.”
Although not confirmed yet, Pioneer will supposedly close down one of its largest Japanese plasma manufacturing plants and focus the other two on assembling TVs. Pioneer stopped internal production of LCDs last year and teamed up with Sharp in a similar deal to this recent one.
Adde Mitsushige Akino of Ichiyoshi Investment Management, “This is an excellent development [Pioneer stopping plasma production]. Pioneer could have chosen another way and stepped up its plasma investment despite the fact that the business is bleeding red ink, but it’s a wise step to decide against that. A quicker decision would have been even better, though.”
Result for: fiscal year
Nikko Citigroup analysts have upgraded their rating for Sony Corporation citing their anticipation that the company will break even or even turn a profit on the PlayStation 3 beginning in August.
If their prediction is accurate, then Sony will break even at least three months earlier than analysts had previously speculated. Sony itself was not sure when it would hit profitability on the console and Sony’s Kaz Hirai said that the company would was shooting for the fiscal year beginning April 2008.
Sony has always said that PS3 production costs will only ever hit break even point when the “65nm Cell processor and the 90nm are shrunk to smaller, cheaper-to-manufacture sizes, and that comes with the side effect of drawing less power and creating less heat.”
It should be interesting to see when profitability occurs because may lead to more price cuts for the consumer.
Result for: fiscal year
Nintendo president Satoru Iwata has revealed that the company is not likely to cut the price of its ever popular Wii and DS gaming systems in the foreseeable future.
“Our earnings projection for the year is not based on hardware price cuts, and I don’t think we are going to need them,” said Iwata.
Despite supply shortages on huge demand for both systems, Nintendo revealed its fourth quarter earnings this week which showed the company has sold 18.6 million Wii consoles over the last 12 months, putting worldwide sales since launch at almost 25 million. The company also added that total sales were up 73 percent year on year “while operating income was up 115.6 percent and profit up 47.7 percent.”
Nintendo added that it hopes to sell 25 million consoles worldwide for the upcoming fiscal year. To meet growing demand, the company will also be ramping up production from 1.8 to 2.4 million consoles every month. Maybe this year there will be Wiis on the retail shelves next to all those PlayStation 3s and Xbox 360s.
