Panasonic records 42% surge in Q1 profit, keeps full-year forecast

Japanese electronics brand Panasonicon Monday revealed a remarkable 42 per cent surge in first-quarter operating profit as a weaker yen and strong sales in its automotive and energy segments bolstered the company's financial performance.

During the three months ending in June, Panasonic's operating profit reached a substantial $637 million, aligning almost precisely with analyst forecasts.

Notably, the battery unit showcased exceptional performance, with its first-quarter operating profit reaching $206 million, representing an impressive increase of over 80 per cent compared to the same period the previous year.

Add WION as a Preferred Source

On the other hand, Panasonic's energy unit, responsible for manufacturing batteries for Tesla, emerged as a major driving force behind their remarkable profit surge during the quarter.

The battery unit further benefited from the U.S. inflation Reduction Act tax credits, contributing to an impressive 80 percent surge in non-adjusted operating profit compared to the previous year.

Panasonic's overall outlook remains optimistic, with the company maintaining its full-year operating profit forecast at a robust $300 billion.

Panasonic's electronic arm struggles in China's challenging market

In the first quarter, Panasonic's industry arm, focusing on electronics components and materials, recorded an 86.8 percent decline in operating profit, totaling $24 million, largely due to challenging conditions in China.

The rapid shift to electric vehicles has driven intense competition in China's auto market. Group CFO Hirokazu Umeda stated that the industrial company is facing increased competition in China's largest auto market, not only due to the swift adoption of electric vehicles but also from an inventory build-up of locally-made gasoline automobiles.

Panasonic also acknowledged the absence of signs indicating a full-fledged recovery in China's factory automation industry. Moreover, industries such as servers, data centers, and ICT are expected to take longer to recover overall.

(Inputs from Reuters)

WATCH WION LIVE HERE