Sony slashing jobs, leaving unprofitable businesses

[smallflyingtaco]

NJ5 said:

 

smallflyingtaco said:

NJ5 said:

PS: Yes, I know there are mitigating factors in that some expenses are paid in $/€ too, but still...

 

 

I was also under the impression this is a longer term benefit, that the commodities are often bought on longer term contracts not enabling a quick response to market changes.

Well, not all the foreign currency expenses are commodities, Sony also has plenty of workers abroad. Besides if the commodities are paid in dollars, the savings in Yen terms will be immediate in that area...

 

Sorry about the late response, review sessions and grading are keeping me busy.  What I meant about a long term benefit is that when you sell a commodity, at least oil, it is no usually an immediate sale but a future sale.  You sell a contract to deliver X amount of oil at Y date.  You sell that at some current price.  These contracts are either then held on to as you want the material or resold to someone else who will take delivery.  In this sort of system you often find that you bought the commodity months to years before you ever get it. Companies often hedge against future increases by buying present contracts, which has the down side that when prices fall you can not immediately benefit from that happening.