Sony/Sharp: A red ink deluge
Sony and Sharp announced $11 billion in annual losses as the first decline in global TV shipments in six years and a stronger yen pummeled Japan’s biggest LCD TV makers. Sony says it lost $6.4 billion in its 2011 fiscal year, the worst earnings performance since its founding in 1946, and Sharp posted a record $4.7 billion loss. Once symbols of Japan’s dominance in electronics, both companies have been hammered by Apple and Samsung, a yen that hit a postwar high, and the aftermath of last year’s quake. The Nikkei newspaper reports that Sony’s new president, Kazuo Hirai, plans to cut 10,000 jobs. Sharp turned to Taiwan’s Foxconn Technology Group for a $1.6 billion infusion.
Northrop Grumman: The Pentagon ups its drone budget
The Pentagon plans to increase its fleet of armed and long-haul surveillance drones by at least 45 percent over the next 10 years. The U.S. military’s inventory of unmanned aerial vehicles will grow to 645 aircraft in 2022 from about 445 in 2013, including versions of Northrop Grumman’s RQ-4 Global Hawk and General Atomics’ MQ-9 Reaper and MQ-1 Predators. Drones are playing an increasing role in defense as the Pentagon trims its budget by $487 billion over the next 10 years and seeks to become more technologically advanced.
Reebok: No Tebowing allowed
Adidas’s Reebok International will recall New York Jets jerseys and T-shirts with quarterback Tim Tebow’s name on them as part of a lawsuit settlement with Nike. Reebok’s licensing agreement ended with the National Football League on March 31 when Nike became the official supplier of NFL apparel. Nike sued to block Reebok from offering the jerseys, which Reebok sold after Tebow was traded to the Jets on March 21. Reebok has agreed to to buy back jerseys from retail stores.
Apple: Sued for price-fixing e-books
The Justice Department filed suit against Apple and five e-book publishers, claiming price fixing. The complaint alleges that when Apple launched the iPad, it let publishers set prices in exchange for a 30 percent cut, under an “agency model” in which publishers, not retailers, price the books. Hachette Book, Simon & Schuster, and HarperCollins settled without admitting liability and agreed to cancel deals with Apple and other online retailers. Apple, Penguin, and Macmillan deny any collusion, say two people familiar with the matter.
JPMorgan Chase: Cutting back on student loans
JPMorgan Chase, the largest U.S. bank, on July 1 will stop providing private student loans to people who aren’t customers of the company. The change comes two years after regulatory changes prevented private lenders such as JPMorgan from originating loans backed by the government. Student loans are now the largest source of unsecured consumer debt in the nation, according to the Consumer Financial Protection Bureau, and rising delinquency rates have spurred speculation about a possible bubble.