Panasonic Corporation, who legally changed their name from Matsushita Electric Industrial Company on October 1st, has "downwardly revised" their current year profit forecast by a whopping 90%.
In their press release they cited the current financial crisis that originated in the United States and which has now spread across the world. They further stated that the business sentiment in Japan and overseas has significantly worsened as a result of this crisis. Additional negative factors that contributed to the 90% downgrade were a write-down of investment securities due to the drop in stock prices and other business restructuring expenses. Previously Panasonic had been forecasting an increase in net profits relative to last year due to healthy sales of flat-panel TVs, DVD recorders and home appliances. They have also been negotiating the purchase of rival Japanese manufacturer Sanyo Electric Company.
Sony Corporation has also downgraded their profit forecasts by a less dramatic but not insignificant 38% (to 150 billion yen).
By the numbers:
Original forecast for the fiscal year ending March 31, 2009
Sales: 9200 billion yen (US$96.47 billion)
Net profit: 310 billion yen (US$3.25 billion)
Revised forecast for the fiscal year ending March 31, 2009
Sales: 8500 billion yen (US$89.12 billion)
Net profit: 30 billion yen (US$315 million)
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