Japanese electronics giant Panasonic said on Thursday its half-year profits fell as sales sagged in China despite growth in its automotive batteries business.
The firm reported net profit decreased by 11.2% year-on-year to 100.9 billion yen (US$929 million) in the six months to September.
Operating profit tumbled 28.1% to 140.3 billion yen on a 4.1% drop in overseas sales to 3.8 trillion yen.
The firm cited a variety of reasons for the drop in operating profit, including lower sales in China and sluggish overseas television sales.
It also noted increased costs related to development expenses for automotive solutions in Europe and the impact of gains from land sold the previous year.
Japanese electronics companies have taken a hit from weakening demand for capital investments in China as the world’s second largest economy has been mired in a trade war with the United States.
Sales in its “industrial solutions” sector dropped 10% to 657.9 billion yen, hit by decreases in portable rechargeable batteries as well as factory-automation motors and sensors which “were impacted by weakening demand for capital investments in China,” Panasonic said.
Sales in the automotive business were up, with the effects of investments for expansion in battery capacity offsetting lower demand for car equipment in China.
But the firm saw an operating loss in the automotive sector due to higher development costs for car devices.
Panasonic is seen as a specialist in the automotive battery sector and has already partnered up with electric vehicle innovator Tesla to operate a huge “gigafactory” in the United States.
Panasonic left unchanged full-year profit forecasts, expecting 200 billion yen in net profit and 300 billion yen in operating profit.
It cut its earlier sales forecast to 7.7 trillion yen from 7.9 trillion yen as it braces for a stronger yen.