The huge Japanese conglomerate reported a major boost in its second-quarter profits, skyrocketing to $641 million from a mere $14 million last year at this time. Bear in mind that Sony took some massive hits last year -- for example, related to its huge battery recall for laptops from companies like Apple
Sony's total sales increased 15% on a U.S. dollar basis (or 12.3% in the local currency, the yen). The consumer electronics segment, which includes its Bravia televisions, Vaio PCs, and Cyber-Shot digital cameras, offered a big boost to the top-line growth.
While the gaming segment did contribute a 43% increase in sales, one of Sony's current sticking points is mentioned in the company's earnings release. Sony said the gaming segment's operating loss increased in the quarter, "primarily due to the loss arising from strategic pricing of PS3 at points lower than its production cost." That operating loss was a whopping $841 million. Most of us realized this was coming, of course. Competition from Microsoft's
Sony may have reported a decent increase in its quarterly profit, but if you flash back, last year's second-quarter results were pretty awful, so it was up against an easy comparison. I've long been a Sony bear, and given some of its strategic missteps over the last couple years and the magnitude of its competition, I still feel it's a stock I would avoid. Some investors were heartened by the second quarter, judging by the stock's increase today, but I'm not won over yet.