Japanese Tech Stock Weekly Summary

The following is excerpted from IRG's weekly stock report:

Media, Entertainment and Gaming

• Nintendo Co. (NTDOY.PK) announced a group profit surging to 132.42 billion yen (US$1.1 billion) in its fiscal first half from 54.3 billion yen (US$0.5 billion) it has posted a year earlier. The company said group sales went up to 694.8 billion yen (US$6.1 billion) from 298.8 billion yen (US$2.6 billion), with 78 percent of sales booked overseas. Following the strong performance, Nintendo said it has upped its profit forecast for the year through March to 275 billion yen (US$2.4 billion) from the 245 billion yen (US$2.1 billion) it predicted in July. The company said it looks to sales posting 10 percent growth to 1.5 trillion yen (U$$13.1 billion).

Internet

• According to media sources, Softbank Corp (SFTBF.PK) plans spend about 40 billion yen (US$350.3 million) for its operations next year at a new data center in southwestern Japan. Softbank plans to begin operations at a data centre facility in Fukuoka Prefecture, which is expected to carry more than 100,000 computer servers in an area of 140,000 square meters. Softbank is seen as focusing its operations on Internet-based companies that typically operate server networks of several thousand units as customers.

• Yahoo Japan Corp. reported a 9.2 percent rise in its group net profit in the April-September fiscal first half to 29.2 billion yen (US$255.7 million) from a year earlier. The Internet service provider said its sales registered a 17.2 percent climb to 117.7 billion yen (US$1 billion) and its advertisement division went up 27 percent to 54 billion yen (US$472.9 million).

Mobile/Wireless

• According to media sources, NTT DoCoMo (DCM) has plans to form a joint venture with UFIDA in a bid to tap China's 3G market. Earlier in February this year, the two companies announced plans to set up a joint venture company to develop enterprise mobile service platform and application. Industry sources have indicated that the joint venture is called at present Yong You Da Kang. It has a total investment of US$13.4 million, with NTT DoCoMo getting one third of the company’s stake. According to UFIDA, the company is the largest local management software supplier in the Asia-Pacific and China’s largest supplier of management software, ERP software, financial software, group management software, human resource management software and SMB management software.

Software

• NTT Data Corp disclosed that through a tender offer, it aims to make German system development and consulting firm itelligence AG a subsidiary. itelligence is a leading IT full service provider for SAP. In the tender offer, to be launched in mid-November by fully owned German unit NTT Data Europe GmbH, the NTT Data group plans to acquire more than 50 percent of outstanding itelligence shares. In this acquisition move, NTT Data reveled that it expects to spend up to 24 billion yen (US$210.2 million). The tender offer is slated to last for about six weeks, with the per-share acquisition price set at 6.2 euros (US$9).

Hardware

• Sony Corp. (SNE) reported net profit climbing to 73.7 billion yen (US$645.4 million) in the three months to September from the 1.7 billion yen (US$14.9 million) it has posted a year earlier. The company said its revenue registered a 12.3 percent growth to 2 trillion yen (US$17.5 billion). Sony ascribed the figures to the surge in sales of digital cameras and laptop computers, sales seen as offsetting heavy losses incurred by the company from the PlayStation 3. The company also said it had swung to an operating profit of 90.5 billion yen (US$792.5 million) from a year-earlier loss of 20.8 billion (US$182.1 million), with losses at its game division more than doubling to 96.7 billion yen (US$846.8 million). Sony upgraded its full-year outlook with a 527 percent rise in operating profit to 450 billion yen (US$3.9 billion) versus its previous target of 440 billion yen (US$3.8 billion).

• Hitachi Ltd. (HIT) announced that it will discontinue development and production of home-use PCs, with the company attributing the decision to intense competition and declining sales. The company said it has not developed PC models for the year-end shopping season and it has no plan to develop any future models at the moment. Hitachi was one of the pioneers of PC development in Japan.

Disclaimer: IRG is not responsible for the accuracy of the news compiled within this article, which is based on publicly available information.