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Moody’s cuts Sony credit rating to junk
Posted By Jeff Belanger On January 28, 2014 @ 11:26 AM In General Tech | No Comments
Due to Sony’s recent poor financial performance, Moody’s has brought down their rating from Baa3 to Ba1. This rating will make it more difficult for Sony to borrow money as it is just underneath an investment grade.
Despite the fact that the recently released PlayStation 4 has sold well, with over4 million units sold during this past holiday season, the company is not doing well in other areas. Their TV and PC divisions are struggling, due to the increased level of competition in those areas, and the company has had to make several layoffs as of late.
According to Moody’s, it will probably be a while before Sony is able to upgrade their status. “We expect the majority of its core consumer electronics businesses — such as TVs, mobile, digital cameras and personal computers — to continue to face significant downward earnings pressure,” they said in their statement about Sony’s performance.
Sony still has a BBB rating with Standard & Pool, which a couple levels up above junk, and have another junk rating with Fitch. At the moment they are currently trading at 16.23, which is slightly lower than it was on Friday.
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