updated 10/31/2006 8:07:34 AM ET 2006-10-31T13:07:34

Sony said Tuesday that the U.S. Department of Justice is probing its electronics unit as part of an industry-wide investigation into sales of a type of memory chip. The news could spell more trouble for a company already stung by sinking profits, a global battery recall and product delays.

The Japanese company received a subpoena from the Justice Department’s antitrust division seeking information about Sony’s static random access memory, or SRAM, business, company spokesman Atsuo Omagari said.

“Sony intends to cooperate fully with the DOJ in what appears to be an industry-wide inquiry,” the company said in a short statement.

Sony has been battered by a worldwide recall of lithium-ion batteries on fears they could overheat and burst into flames. The recall affected almost every major laptop maker in the world, including Dell Inc., Apple Computer Inc. and Lenovo.

Just last week, Sony Corp. said profit plunged 94 percent in the July-Sept. quarter, thanks to the battery recall and red ink in its video-game business.

It also has lowered its profit forecast for the fiscal year through March 2007 to $673 million, down 38 percent from its initial projection and down 35 percent from fiscal 2005.

SRAM is a kind of computer memory that is faster and more reliable than DRAM, or dynamic random access memory. Although it does not need to be refreshed like DRAM, SRAM is also more expensive.

SRAM is found in relatively small quantities in personal computers. It’s also used in disk drives, communications equipment and networking gear.

Omagari declined to provide other details about the investigation. In 2005, Sony sold 3.3 $27.7 million worth of SRAM. The product is made by outside manufacturers for Sony, which in turn sells the memory chips to other electronics makers, Omagari said.

He would not elaborate on who manufactures the chips for Sony or to whom Sony sells them.

Earlier this month, U.S.-based chipmaker Cypress Semiconductor Corp. said its SRAM operations were also under investigation by the Department of Justice.

A separate Justice Department investigation into price-fixing among DRAM companies has so far resulted in more than a dozen charges against individuals and more than $731 million in fines against Samsung Electronics Co., Elpida Memory Inc., Infineon Technologies AG and Hynix Semiconductor Inc.

Problems with the long-awaited next-generation PlayStation 3 console have also dug deep into Sony.

Sony reported a $366 million operating loss in its gaming division in the July-September quarter because of charges related to its development.

Sony said last month that the machine’s launch in Europe will be delayed until March next year, because of mass production problems in a video technology called Blu-ray disk that the machine supports. The PlayStation 3 is set to go on sale in the U.S. and Japan next month.

The company also reduced the PS3 price in Japan by about 20 percent in an effort to win buyers — a move that’s likely to reduce sales revenue because initial shipments are expected to be limited and sell out.

The company announced the probe Tuesday after the market closed.

© 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


Discussion comments


Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments

Data: Latest rates in the US

Home equity rates View rates in your area
Home equity type Today +/- Chart
$30K HELOC FICO 3.79%
$30K home equity loan FICO 4.99%
$75K home equity loan FICO 4.69%
Credit card rates View more rates
Card type Today +/- Last Week
Low Interest Cards 13.83%
Cash Back Cards 17.80%
Rewards Cards 17.18%
Source: Bankrate.com