Sony hit by historic $1 billion annual loss
Warns that it will lose more money as recession woes continue to plague conglomerate
Sony Corporation has lost 98.9 billion yen ($1 billion) this year and predicts more trouble as the recession continues to take its toll on consumer spending.
The company’s fiscal year, which ended on March 31st, showed a $1 billion decline in profit compared to a healthy $3.5 billion for the same period last year. It’s the first time in the last fourteen years that the company reported an annual loss.
Sony had earlier announced it would lay off 16,000 employees and close a number of factories by early 2010 in the hope of improving profitability.
Each segment of the company took a hit this year - Sony’s sales of electronics products such as the Bravia flat-panel TVs and Cyber-shot digital cameras fell 17%, the game segment including PlayStation consoles and related software decreased 18%, their home entertainment and motion pictures division contracted by 16.4%, while the Sony Life financial services segment also fell by 7.4%.
“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,” a company statement read.
Sony isn’t expecting to get out the red anytime soon either. In spite of ongoing restructuring efforts, the company predicts a $1.2 billion loss for their next fiscal year through March 2010.