SeekingAlpha's Sony quarterly earnings transcript updates on its image sensor business status:
"Next is Devices. Sales for the fiscal year are expected to be below the August forecast due to lower-than-expected sales of image sensors. We also expect sales to decrease year-on-year. Operating income is expected to be below the August forecast due to the decrease in sales and we expect operating income to decrease significantly year-on-year."
Daniel Ernst - Hudson Square Research:
"And then second question on the weakness that you noted in image sensors, can you parse that between image sensors sold into the digital still camera market versus image sensors sold into the smartphone market. Are the 2 diverging i.e., DSC sales are going down but image sales to smartphones continues to be strong, or not?"
Masaru Kato - Sony CFO:
"On the image sensor questions, yes, we have lowered somewhat the forecast for the semiconductor business. And in image sensors, what you said is correct in that it is mainly due to the decline in the digital still cameras. Now this is an industry-wide phenomenon. So since we have a very nice market share in this area, if the market goes down, our sales will be affected. On the smartphone side, this is still a growing market for us."
Timothy Lash - Third Point LLC:
"One follow-up on electronics -- on electronics, your semiconductor business, your Devices business is lower than forecast. You've sort of kept your CapEx in line. Any thought to adjusting your capital spending in that unit as the revenue forecasts come down?"
Masaru Kato - Sony CFO:
"Okay. Now, we have -- in the semiconductor area, most of the CapEx is in image sensors. We do have other areas, such as logic, LSIs and gaming chipsets. But these areas do not carry big CapEx. And it is image sensors. Here in this image sensors, in the long term, we still see growth. But since we have already made a lot of investment, we do have the manufacturing base for growth in this area. So yes, we will continue to invest in image sensors as necessary but it might not be in the kind of magnitude that we have been doing in the past several years."
From Sony presentation slides:
"Next is Devices. Sales for the fiscal year are expected to be below the August forecast due to lower-than-expected sales of image sensors. We also expect sales to decrease year-on-year. Operating income is expected to be below the August forecast due to the decrease in sales and we expect operating income to decrease significantly year-on-year."
Daniel Ernst - Hudson Square Research:
"And then second question on the weakness that you noted in image sensors, can you parse that between image sensors sold into the digital still camera market versus image sensors sold into the smartphone market. Are the 2 diverging i.e., DSC sales are going down but image sales to smartphones continues to be strong, or not?"
Masaru Kato - Sony CFO:
"On the image sensor questions, yes, we have lowered somewhat the forecast for the semiconductor business. And in image sensors, what you said is correct in that it is mainly due to the decline in the digital still cameras. Now this is an industry-wide phenomenon. So since we have a very nice market share in this area, if the market goes down, our sales will be affected. On the smartphone side, this is still a growing market for us."
Timothy Lash - Third Point LLC:
"One follow-up on electronics -- on electronics, your semiconductor business, your Devices business is lower than forecast. You've sort of kept your CapEx in line. Any thought to adjusting your capital spending in that unit as the revenue forecasts come down?"
Masaru Kato - Sony CFO:
"Okay. Now, we have -- in the semiconductor area, most of the CapEx is in image sensors. We do have other areas, such as logic, LSIs and gaming chipsets. But these areas do not carry big CapEx. And it is image sensors. Here in this image sensors, in the long term, we still see growth. But since we have already made a lot of investment, we do have the manufacturing base for growth in this area. So yes, we will continue to invest in image sensors as necessary but it might not be in the kind of magnitude that we have been doing in the past several years."
From Sony presentation slides:
