Japanese electronics companies which have been falling behind rivals from South Korea and Taiwan in recent years are making a comeback. The companies were hit hard by the global economic crisis last year and the appreciation of the yen. However, signs of a global rebound coupled with growth in emerging markets are impacting the electronics sector positively.

Japan’s electronics giants reported gains in their net profit in Q2. Sony has raised its outlook for 2010 after reporting a net profit of JPY 25.7 billion (*S$0.40 billion) in the second quarter. This is a sharp turnaround after the loss of JPY37.1 billion in the previous year.  

The gain in profits was driven by Sony’s core electronics business. Flat-panel TVs, Vaio computers and the PlayStation 3 gaming console saw an increase in sales. 5.1 million LCD TVs were sold in Q2, a rise of 59 per cent from the same period last year. Sales of PlayStation 3 consoles more than doubled to 2.4 million units.

Sony’s chief financial officer, Masaru Kato is optimistic about outlook for the industry. He said that the electronics sector is back on track and business should remain strong due to rising consumer interest in electronics and entertainment.

Panasonic announced that it would focus on its renewable energy business and will be spending up to JPY818 billion to buy out two subsidiaries, Sanyo Electric and Panasonic Electric. It reported a similar revival of earnings of JPY43.7 billion in Q2.

Panasonic has realised that the most promising technologies – like green technology – are owned by subsidiaries and it is seeking to integrate these technologies to its core business. This will help it combat competition from rivals South Korea’s Samsung Electronics and Sony. Sanyo was the leading manufacturer of rechargeable batteries in the 2009 fiscal year.  

Sharp, another Japanese electronics producer said that it had earned a net profit of JPY10.9 billion in the last quarter.  

Nintendo, however, remains in the red. The maker of the Wii gaming console and the DS handheld reported a reversal from the positive figures. The lack of new games and the strong yen was blamed for Nintendo’s fortunes.

*Exchange rate correct as at 30 July 2010