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Sony Shares Fall After Ratings Cut

| 24 Aug 2006 16:15

Sony shares fell 3 percent after a Japanese brokerage firm slashed PS3 unit forecasts to 3 million units by the end of March.

Mitsubishi UFJ Securities estimated that Sony would not be able to ship the expected 6 million PS3 units by the end of March due to issues with procuring enough cutting-edge parts. The firm cut Sony's estimate by half, sending Sony stock down 3.2 per cent. "In the medium term this would mean that it would take longer for Sony to recover its huge investment in PS3 and thus we are downgrading the stock," said the analyst in a note to clients yesterday.

Reuters notes that while the PS3 is a major part of their Blue-ray strategy, Sony also hopes to increase output and lower production costs on the Cell microchips for use in other electronics.

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