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Sony moves a step closer to junk; outlook "negative"

Fitch Ratings (a company that assesses the risk level of debt) announced today that they have downgraded several types of Sony debt to "BBB+" (the debt is still three notches above the dreaded "junk" moniker, however). Fitch also slapped a "negative" outlook on the debt, indicating that future debt downgrades are possible as "Sony's financial profile [continues] to weaken in the next one to two years."

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rj813752d ago

At Sony's last 12 months. Here is where its profits came from (in millions):
Electronics (262.1)
Games 74.1
Pictures 232.5
Financial Services 1,596.1
Other 137.2
Corporate (156.8)
Total: 1,620.9

98.5% of Sony's profits come from financial services. That's right. Sony isn't an electronics company. It's a financial services company that sells electronics.

calderra3752d ago

Wow. Sony had 1.6B in profits for the last 12 months? I thought Sony's movie side was bigger than their entire bottom line...

To note:
"For the three-month period ending March 31, 2006, [Microsoft] had income of $10.9 billion, which yielded it $2.98 billion in profits."

...in 3 months.

DJ3752d ago

Huh. That's uhh...they're a financial services company?! I don't think anyone ever realized that. Where'd you find this crazy info?

SjaakHaas3752d ago

Thats why they lack in customer service, they just dont spend there money on it.

rj813752d ago

I read their quarterly financial reports for the last 12 months (4 quarters). I know they fashion themselves as an electronics company, but the source of their profits reveals a different story.

rj813752d ago

Financial Services segment engages in life and non-life insurance, Internet-based banking, and leasing and credit financing businesses. This segment also offers various financial services, including savings and loans.

TheMART3752d ago

Lot's of financing of their audio/video stuff probably in shops. So one can't do without the other I guess. Credit financing&leasing stuff.

But still. A junk bond it became almost dropping from 160 alltime high to 120, to under 40 dollars...

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