Sony warns of greater losses
Issued on: Modified:
Japanese entertainment and technology giant Sony has predicted an annual operating loss of 2.9 billion dollars, far in excess of analysts' forecasts. The unprecedented loss will likely prompt the company to accelerate its planned restructuring.
AFP - Sony Corp. on Thursday forecast an annual operating loss of 2.9 billion dollars, the first in 14 years, as the economic crisis batters demand for its televisions, cameras and other goods.
Sony, a bellwether of corporate Japan, said it expects an operating loss of 260 billion yen for the current financial year to March, a dramatic reversal from an earlier goal for a 200-billion-yen profit.
The electronics giant, which is slashing thousands of jobs and axing plants, now sees a net loss of 150 billion yen for the current year, compared with an earlier projection for a 150-billion-yen profit.
Sony blamed the worsening business environment, the stronger yen, weak financial markets and restructuring costs for the bleak outlook.
Under its first foreign boss, Howard Stringer, a Welsh-born US citizen, Sony has shed non-core assets and axed thousands of jobs in recent years. Last month it announced 16,000 more job cuts along with factory closures.
A big loss would be a far cry from the operating profit of 475 billion yen the company made last year.
Before the economic crisis erupted the electronics icon had been recovering from a difficult spell in the face of tough competition from rival products such as Apple's iPod and Nintendo's Wii.
Stringer was due to announce measures later in the day to shore up the company's core electronics business, amid reports that it will close a television factory in Japan.
Daily newsletterReceive essential international news every morningSubscribe