TOKYO (Reuters) – Panasonic (OTC:) Corp on Tuesday raised its full-year operating profit forecast by more than a half, benefiting from demand for its batteries in Tesla (NASDAQ:) Inc cars, pandemic-driven buying of home appliances and sales of 5G equipment.
The strong performance in those segments offset pain for parts of its businesses that have been hurt by the coronavirus pandemic, such as in-flight entertainment systems and display panels.
Its new forecast of 230 billion yen ($2.2 billion) for the year to end-March is still 22% below the previous year. But it beats both the company’s earlier estimate of 150 billion yen profit and a Refinitiv consensus prediction of 175 billion yen.
After several years of production troubles and delays at its U.S. partner, Panasonic is beginning to see its decade-old partnership with Tesla become a profit driver.
Panasonic announced in October that it was developing a new battery cell designed by Tesla, with the U.S. company saying it would help halve battery costs and ramp up battery production 100-fold by 2030.
The Japanese electronics conglomerate is also planning to add a new production line at the Nevada factory it owns with Tesla, and is looking at building a lithium-ion battery business in Norway in a bid to tap European carmakers.
Panasonic’s shift away from its low-profit home electronics business to focus on housing fixtures, car electronics and batteries for electric vehicles has been overseen by outgoing Chief Executive Kazuhiro Tsuga.
The company announced in November that Tsuga would step down in April after nine years at the helm and that Yuki Kusumi, the current head of its automotive business, would take over.
For the three months ending Dec. 31 the company posted a 30% rise in operating profit to 130.2 billion yen. It easily beat a Refinitiv estimate of 74.6 billion yen from four analysts.
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