Sony to report $3.2 billion annual loss

May 23, 2011 By MARI YAMAGUCHI , Associated Press
Sony Corp. Chief Financial Officer Masaru Kato reacts during a press conference in Tokyo, Monday, May 23, 2011. Sony, the Japanese maker of PlayStation 3 video game machines and Bravia flat-panel TVs, said Monday the sharp downward revision to a net loss of 260 billion yen is ($3.2 billion) is mainly due to the impact from the March 11 earthquake and tsunami. (AP Photo/Koji Sasahara)

(AP) -- Sony Corp. is expecting an annual loss of $3.2 billion, reversing its earlier projection of a return to profit, as the electronics giant struggles with production disruptions from Japan's tsunami and a hacker attack on its online gaming service.

The Japanese maker of and Bravia said Monday that the projection of a 260 billion yen ($3.2 billion) net loss for the fiscal year ended March 2011 was largely due to writing off 360 billion yen ($4.4 billion) related to a tax credit booked in a previous quarter.

announced the loss ahead of its official earnings announcement Thursday under Tokyo Stock Exchange guidelines. The company had earlier projected a 70 billion yen ($860 million) profit.

Like many other Japanese manufacturers, Sony has been hampered by the production disruptions set off by the March 11 earthquake and tsunami that killed more than 25,000 people, destroyed many factories and sent the nation's into reverse.

The company kept its forecast unchanged at 200 billion yen ($2.46 billion). It expects to report sales of 7.18 trillion yen ($88.2 billion), slightly down from an earlier projection of 7.2 trillion yen ($88.5 billion).

Masaru Kato, Sony's chief financial officer, said parts shortages in the aftermath of the disaster have eased but a full recovery hasn't yet been realized.

"In the first quarter, we saw quite a major impact on our manufacturing activities," he said. After the quake, "negative factors have grown bigger" and offset earlier improvement in the previously loss-making games division, dashing hopes for a profit.

Tokyo-based Sony also faced a new challenge to its reputation following a massive security breach affecting more than 100 million online accounts.

After temporarily closing down its online gaming services last month, Sony began restoring its PalyStation Network services in the U.S. and Europe on May 15 mainly for online gaming, chat and music streaming services.

Sony spent 14 billion yen ($170 million) to cover costs that included identity theft insurance for customers, improvements to network security, free access to content, customer support and an investigation into the hacking.

Sony has seen plunging sales of flat-panel TVs and other gadgets, and was likely to remain in the red in its TV business for the seventh year straight.

Sony has also taken a beating in music players and other portable devices to Apple's iPod, iPhone and iPad.

The company booked a 40.8 billion yen ($439 million) loss for the fiscal year ended March 2010 after a 98.9 billion yen loss the year before- Sony's first annual red ink in 14 years.

Explore further: EU Parliament votes to break up Google

not rated yet
add to favorites email to friend print save as pdf

Related Stories

Sony rebounds to profit in April-June quarter

Jul 29, 2010

(AP) -- Sony bounced back to profit last quarter and raised its full-year earnings forecast, fueled by stronger demand for its PlayStation 3 gaming consoles, personal computers and televisions.

Sony aiming for black as annual loss shrinks

May 13, 2010

(AP) -- Sony Corp., maker of the PlayStation 3, stayed in the red last business year but predicts a return to profit as restructuring and an aggressive 3-D rollout bear fruit.

Panasonic announces Q1 net loss of 560 mln dlrs

Aug 03, 2009

Japanese high-tech giant Panasonic Corp. announced Monday a big first-quarter loss, blaming weak sales of televisions, digital cameras and other electronic goods during the recession.

NEC sees losses triple

Jan 27, 2011

Japan's NEC said Thursday its net loss in the October-December quarter almost tripled from a year earlier, blaming a delay in the recovery of IT-related capital investment in the country.

Sony quarterly profit falls 8.6 pct on strong yen

Feb 03, 2011

(AP) -- Sony's quarterly profit dropped 8.6 percent as a strong yen and falling TV prices erased the boost the Japanese electronics and entertainment company got from its hit movie "The Social Network."

Recommended for you

EU Parliament votes to break up Google

Nov 27, 2014

The European Parliament voted overwhelmingly for the break-up of Google Thursday in a largely symbolic vote that nevertheless cast another blow in the four-year standoff between Brussels and the US Internet ...

Toyota finds new air bag issue, recalls more cars

Nov 27, 2014

Toyota Motor Corp. recalled more than 40,000 vehicles in Japan on Thursday as part of a worldwide scare over defective air bags and is investigating a new type of air bag problem that could lead to further recalls.

Netflix sues Yahoo CIO for alleged kickbacks

Nov 26, 2014

Netflix is suing a former company vice president who is now chief information officer at Yahoo, accusing him of receiving money from vendors he hired to work with the video streaming company.

User comments : 1

Adjust slider to filter visible comments by rank

Display comments: newest first

spectator
not rated yet May 23, 2011
Outdated, over-specialized entertainment technology cannot compete with a "one gadget does everything" market.

Only thing I watch on television any more is the Weather channel and football, and I don't really need or want 3-d television, particularly since the service is non-existent on cable right now, and even if it did exist, it would cost more, etc.

The world has reached a point where people neither need nor want to run out and buy the latest marginal improvement to a television set every year or two, particularly since they can go buy the latest marginal improvement to a PC or a smartphone or other handheld computer for less than half the price of the television.

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.