TOKYO, Dec. 2 (Xinhua) -- Japan's corporate profits saw the first year-on-year decrease in seven quarters for the July-September period as intensifying competition with overseas firms and a temporary yen appreciation dragged down manufacturing profits, government data showed Monday.
Profits for all industries excluding finance and insurance reached 23.0124 trillion yen (about 153 billion U.S. dollars) for the July-September period, marking a 3.3-percent decline from the same period last year, according to Japan's Ministry of Finance.
Manufacturing sector profits plunged 15.1 percent, driven primarily by a 16.8-percent drop in transportation equipment, such as automobiles. Heightened competition abroad and a September exchange rate fluctuation that temporarily strengthened the yen to 139 per dollar contributed to the decline.
In contrast, the non-manufacturing sector saw a 4.6-percent increase in profits. Services led the gains, with a 64.3-percent rise due to higher dividend income from holding companies. Investments in digital transformation boosted the information and communications sector by 10.8 percent.
Capital expenditures rose 8.1 percent year-on-year to 13.411 trillion yen (about 89.4 billion dollars), marking the 14th consecutive quarter of growth. Both manufacturing and non-manufacturing sectors expanded investments, driven by semiconductor-related demand, urban development projects near train stations, and new hotel openings.
Despite the profit decline, the quarterly profits were the second-highest on record for the July-September periods, trailing only to the same period last year. The ministry attributed the performance to Japan's modest economic recovery, but noted the need to monitor risks such as slowing overseas economies and domestic inflation. ■