Sony announces losses over $2 billion

By Patrick Avenell

JAPAN: Sony Global has announced the Japanese consumer electronics giant has recorded an operating loss of US$2.34 billion for the 12 months ended 31 March 2009. Total revenue for this period was US$78.8 billion.

In its bullet points to introduce this results announcement, Sony blamed the global financial crisis and a strong yen for the losses. Although the operating loss is over US$2 billion, the net loss amount is less than half this figure, and at US$1.01 billion, it is less than many speculators had predicted.

“Sales decreased and losses were recorded due to factors including the slowdown of the global economy, the appreciation of the yen and the decline in the Japanese stock market,” read the earnings result.

In the electronics segment, Sony sales decreased 17 per cent on JFY08, with Sony again citing the appreciation of the yen and economic conditions as reasons. Additionally, though, Sony has singled out the “intensification of price competition” as a direct reason for this slide in sales. In total, electronics revenue totalled just under US$56 billion.

In gaming, Sony experienced a sales decrease of 18 per cent, which has been attributed to a decline in sales for the PlayStation 2 console. Sales revenue from gaming was US$10.7 billion, with a net loss of US$597 million recorded. This loss is actually an improvement on JFY08. Sony reports its most popular console device was the PSP, which sold 14.1 million units worldwide.

Sony Pictures proved a moneymaker over JFY09, with US$7.3 billion in sales revenue enabling a US$305 million profit. Sony directly attributed this good result to films including Hancock, Paul Blart: Mall Cop and Quantum of Solace.

Additionally, Sony Financial Services recorded a US$318 million net loss on US$5.4 billion revenue, and ‘All Other’ categories recorded a US$310 million income on US$5.5 billion revenue.

For the future, Sony Electronics predicts it will incur a slight increase in losses as it continues its restructure.

“A decrease in sales expected mainly due to the continuing weakness in the business environment as well as the impact of the appreciation of the yen against the US dollar and the euro.

“Regarding operating income, we endeavour to reduce manufacturing costs and operating expenses, and in particular, in the television business we expect operating loss to contact significantly.

“However, overall operating loss is expected to slightly increase mainly due to an increase in restructuring charges.”

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