Japan's Sharp Corp. said today its quarterly profit rose 20 per cent to a record on strong demand for liquid crystal display TVs and cellphones, and reiterated its full-year outlook for a rise of 6 per cent.
Sharp has been cashing in on its gamble relatively early on in the industry to shift its resources away from traditional cathode ray tube TVs and into the LCD TV market, which more than doubled in size to about 20 million units worldwide in 2005.
Strong LCD TV demand also helped rival Sony Corp. post a surprisingly robust quarterly profit, while brisk sales of plasma display TVs are thought to have led to higher earnings at Matsushita Electric Industrial Co. Ltd.
Sharp, the world's top maker of LCD TVs, said group operating profit came to 43.77 billion yen ($373.6 million) in the October-December quarter, compared with an operating profit of 36.46 billion yen a year earlier.
Sales in October-December rose 12.5 percent to 731.72 billion yen.
"The good times should continue into the fourth quarter," Sharp Corporate Director Tetsuo Ohnishi told a news conference.
The strong showing will solidify the perception of Sharp as a winner in the cutthroat electronics industry. Rivals Sanyo Electric Co. and Pioneer Corp., by comparison, are losing money, closing plants and cutting jobs.
Victor Co. of Japan Ltd. (JVC), another embattled electronics maker, said today its third-quarter operating profit fell 80 per cent to 1.5 billion yen, unable to compensate for tumbling prices of LCD TVs.
Sharp announced last month that it would spend an additional 200 billion yen to boost output at a cutting-edge LCD factory as it aims for a bigger slice of the flat TV market, which is growing rapidly as consumers trade in their boxy tube TVs.
But Sharp's earnings growth has been held back somewhat by tumbling prices of flash memory chips, leading Sharp President Katsuhiko Machida to comment last month that the company would seek to shrink the business.
Mr Ohnishi said Sharp planned to shift some of its production capacity for flash memory to image sensor chips used in digital cameras and mobile phones, and to chips used in LCD panels.