Don't touch Sony, Panasonic's junk, says credit agency

Pana may grope its way out of misery, though


Panasonic has a better chance than Sony of surviving the global disinterest in new consumer electronics, credit rating agency Fitch said today.

Fitch downgraded the two debt-saddled firms to junk status: Panasonic's credit rating was pushed down two ranks to double-B, and Sony was nudged down three to double-B-minus. Panasonic is still ahead of Sony, meaning Fitch reckons it has a better chance of being able to pay its debts that Sony does.

"[Panasonic] has the advantage of a relatively stable consumer appliance business that is still generating positive margins," Matt Jamieson, Fitch's head of Asia-Pacific, told Reuters. "Most of [Sony's] electronic businesses are loss making, they appear to be overstretched."

When a company reaches junk level, it will find it almost impossible to raise money for its business, which can push it over the edge.

All of Japan's major electronic firms are suffering, as folks around the world put off buying new tellies and other big ticket items, while the strong yen eats into their profits and competitors in South Korea get ahead of them.

Sharp has already bagged a 30bn yen (£236m) bailout from banks, while Panasonic has persuaded lenders to part with 600bn yen (£4.7bn).

Most of the firms are also engaged in restructuring: they're trying to find pieces of their business that can survive the downturn and concentrate on that. Panasonic is focussing on appliances, solar panels, lithium batteries and automotive components, while Sony is staying with gadgets, cameras and gaming.

Both companies have also found a way to ride out the year; Panasonic with its bank bailout, and Sony with a full-year profit of $1.63bn after selling its chemicals business to a Japanese state bank and raising $1.9bn through convertible bonds it managed to get out before the ratings downgrade. ®

Similar topics


Other stories you might like

  • Infosys skips government meeting - and collecting government taxes
    Tax portal wobbles, again

    Services giant Infosys has had a difficult week, with one of its flagship projects wobbling and India's government continuing to pressure it over labor practices.

    The wobbly projext is India's portal for filing Goods and Services Tax returns. According to India’s Central Board of Indirect Taxes and Customs (CBIC), the IT services giant reported a “technical glitch” that meant auto-populated forms weren't ready for taxpayers. The company was directed to fix it and CBIC was faced with extending due dates for tax payments.

    Continue reading
  • Google keeps legacy G Suite alive and free for personal use
    Phew!

    Google has quietly dropped its demand that users of its free G Suite legacy edition cough up to continue enjoying custom email domains and cloudy productivity tools.

    This story starts in 2006 with the launch of “Google Apps for Your Domain”, a bundle of services that included email, a calendar, Google Talk, and a website building tool. Beta users were offered the service at no cost, complete with the ability to use a custom domain if users let Google handle their MX record.

    The service evolved over the years and added more services, and in 2020 Google rebranded its online productivity offering as “Workspace”. Beta users got most of the updated offerings at no cost.

    Continue reading
  • GNU Compiler Collection adds support for China's LoongArch CPU family
    MIPS...ish is on the march in the Middle Kingdom

    Version 12.1 of the GNU Compiler Collection (GCC) was released this month, and among its many changes is support for China's LoongArch processor architecture.

    The announcement of the release is here; the LoongArch port was accepted as recently as March.

    China's Academy of Sciences developed a family of MIPS-compatible microprocessors in the early 2000s. In 2010 the tech was spun out into a company callled Loongson Technology which today markets silicon under the brand "Godson". The company bills itself as working to develop technology that secures China and underpins its ability to innovate, a reflection of Beijing's believe that home-grown CPU architectures are critical to the nation's future.

    Continue reading
  • China’s COVID lockdowns bite e-commerce players
    CEO of e-tail market leader JD perhaps boldly points out wider economic impact of zero-virus stance

    The CEO of China’s top e-commerce company, JD, has pointed out the economic impact of China’s current COVID-19 lockdowns - and the news is not good.

    Speaking on the company’s Q1 2022 earnings call, JD Retail CEO Lei Xu said that the first two years of the COVID-19 pandemic had brought positive effects for many Chinese e-tailers as buyer behaviour shifted to online purchases.

    But Lei said the current lengthy and strict lockdowns in Shanghai and Beijing, plus shorter restrictions in other large cities, have started to bite all online businesses as well as their real-world counterparts.

    Continue reading
  • Foxconn forms JV to build chip fab in Malaysia
    Can't say when, where, nor price tag. Has promised 40k wafers a month at between 28nm and 40nm

    Taiwanese contract manufacturer to the stars Foxconn is to build a chip fabrication plant in Malaysia.

    The planned factory will emit 12-inch wafers, with process nodes ranging from 28 to 40nm, and will have a capacity of 40,000 wafers a month. By way of comparison, semiconductor-centric analyst house IC Insights rates global wafer capacity at 21 million a month, and Taiwanese TSMC’s four “gigafabs” can each crank out 250,000 wafers a month.

    In terms of production volume and technology, this Malaysian facility will not therefore catapult Foxconn into the ranks of leading chipmakers.

    Continue reading
  • NASA's InSight doomed as Mars dust coats solar panels
    The little lander that couldn't (any longer)

    The Martian InSight lander will no longer be able to function within months as dust continues to pile up on its solar panels, starving it of energy, NASA reported on Tuesday.

    Launched from Earth in 2018, the six-metre-wide machine's mission was sent to study the Red Planet below its surface. InSight is armed with a range of instruments, including a robotic arm, seismometer, and a soil temperature sensor. Astronomers figured the data would help them understand how the rocky cores of planets in the Solar System formed and evolved over time.

    "InSight has transformed our understanding of the interiors of rocky planets and set the stage for future missions," Lori Glaze, director of NASA's Planetary Science Division, said in a statement. "We can apply what we've learned about Mars' inner structure to Earth, the Moon, Venus, and even rocky planets in other solar systems."

    Continue reading

Biting the hand that feeds IT © 1998–2022