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Sony Confirms Rumours, Warns Of Loss

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Sony Confirms Rumours, Warns Of Loss

We've heard the rumours of Sony recording a loss this quarter, and it looks like they're going to prove true, based on Sony's just-published revised predictions. Sony now expects net loss of ¥150 billion (~£1.22 billion), a definite change from the previous estimate (from October last year) of ¥150 billion profit and last year's actual net profit of ¥369 billion (£3 billion).

In Sony's words: "Consolidated sales and operating income for the second half of the fiscal year ending March 31, 2009 are expected to be significantly lower than the October forecast, primarily due to a deterioration in the business environment as a result of the global economic slowdown, the continued appreciation of the yen, the impact from the decline in the Japanese stock market and an increase in expected restructuring charges."

In other words, no-one is buying Sony's products, the Yen is getting stronger (making Sony's over-seas income worth less to the company) and Sony is spending money on restructuring to make the business more cost-effective in the future.

Link:

Sony Investor Relations.

Go to comments

bobsta

January 24, 2009, 5:23 pm

Sony have always been overpriced and considering the competition have caught up and in some cases beaten Sony at its own game in making and selling quality electronic products, their days are numbered unless they start tackling the pricing issue.

SRS

January 24, 2009, 6:39 pm

Not surprising. Apart from the current grim financial climate, Sony's just lost its way. Exploding batteries, expensive laptops filled with cheap nasty bloatware, Rootkits, severe PSP screen problems and the head-in-the-sand response, DRM, the constant pushing of non-standard connectivity, dropping quality (so much creaky plastic now). I could go on, but you get the idea. I hope we see the real Sony again sometime; my worry is that we already are.

MrGodfrey

January 25, 2009, 12:38 am

I feel the need to speak in defence of Sony; I do not agree they have lost their way. The Playstation 3 is a great console (and decent media/Blu-Ray player) and I for one like having a console that doesn't need replacing twice before getting a non-faulty one. Their MP3 players are excellent (now that they are actually MP3 players), as are the Sony Ericsson phones. I am very happy with their in-car stereo units, and while Canon or Nikon snobs might not want to admit it, they make some very good cameras indeed (not to mention their rather nice video cameras). Plus if I was in the market for an overpriced style-over-substance laptop, I would still choose a Sony over an Apple :P


Yes, the build quality on some items is not as good as we might hope, but Sony is most definitely not alone there!





If you believe I am a Sony fanboy, I am not - I still prefer Samsung for TVs, Pentax for still and Panasonic for video cameras - there may not be any product area where Sony would be my clear first choice (except the PS3, and even then I'd love to have a (working) XBox too). And yes of course they have their problems: still the obsession with proprietary media and connections, some of their software is shocking and they will never be allowed to forget the Batterygate scandal (honestly you'd think hundreds of people were being killed by flying shards of detonating laptop...) But really, do I think you're being a bit harsh...

hankb6d

January 25, 2009, 2:33 pm

@MrGodfrey





Sony are indefensible, they are feeling the blunt of their own sword. I'm not going to get into PS3 vs 360, but to suffice to say, yes I have had three Xbox 360's something which infuriates me, but even so it still kills the PS3 in terms of entertainment.





Who cares about media/movie options, Sony frauded gamer's with all their flag bearers, MGS4, who in their right mind wants to watch hours of warped japajigoistic dialogue under the cloak of a game.





Who in their right mind would put up with game killing problems of another flag bearer called SOCOM. Who in their right mind pays &#16319.99 for a demo of another much delayed flag bearer named Gran Turismo.





Only a few wanted to try the simplified game creation doll thing LBP, those creative enough saw their hard work removed from the PSN for IP infringement. I don't want to make games I want to play them, no matter what overhype precedes them.





If your a gamer it's time to face facts and get the knives out, stop this denial because if people keep telling Sony everything's fine the problem will not get sorted.





Right now they need to pull off a donut of 360 proportion's they are heading on a road to nowhere.





Previously I was attached to the PS2 but it's hold has nothing on the hold of the 360.





Sony messed up big time console wise are some theories.





1. Price.


2. Games.


3. A misplaced vision that people like to virtually hang out in a "second life" clone. 4. BLU RAY which is already a DEAD format.


5. The premium paid for their quality over brand name across their product range is no longer evident they are getting raped by Sammy in my other household appliance needs, even my Dyson is looking anxiously over the shoulder at a cheaper Samsung substitute.





It would be a shame to see such a much loved brand lose out but the have succumbed to their own negligence, arrogance and greed in their perception of their consumer





Personally to push Blu Ray on me showed just what a nerve they have, next time maybe they shouldn't cosy up so much to Hollywood.





Sony need to lose the creeps at the top, but it's the hard workers who always carry the can, in these cutbacks.





I don't like that too so as a consumer I will not buy their products anymore without any regrets.

prag fest

January 25, 2009, 8:13 pm

Poor old PS3, it really is a fantastic bit of kit and I think perhaps a bit too ahead of the times for it's own good. It's quite visionary in terms of being an all in one, high end media device and does a far better job of this than the 360. I think a lot of people just cant make that mental jump of a 'games console' doing more than just playing gmaes.





Having said that, the online service is garbage compared to live and the obvious lack of wooing developers and advertising is killing the thing.





So Sony execs, here's what to do and you can have this advice for free:





1) Copy xbox live and stick it on the PS3.


2) Get off your high horse / laurals "but we are Play Station, you come to us" and beg, bribe devs to start making cool stuff for your console.


3) Advertise the damn thing!





Not hard is it? All the cash they must earn too.

m memmory

January 25, 2009, 8:41 pm

I'm not a massive Sony fan by any chance (I prefer cheaper things that'll work) but I have to say that, now, I do really enjoy the PS3.





As a games machine it is blatantly not as good as a Xbox. But the games are still good fun (I love playing Pro Evo, GTA IV & Uncharted - yes I know I could play most of them on the Xbox but I got a PS3 for free) But as a media machine it's great - I can stream movies/music from my PC and play them back on my PS3 brilliantly.





And as for Blu-Ray. Well I recently started getting high-def films and high definition is brilliant. Personally I couldn't care which high def format won as long as one did so that it could be the standard but I really don't see it as a dead format - what's going to replace it? Downloads? Not until broadband can actually download things quickly & easily. I have a 2mb connection and to get a film on that I'd have to wait a couple of days at least (and probably get hammered for downloading so much and have the connection lowered massively) I can see downloads being the way to get everything at some point - but not for a very long time yet so physical media is the way to go.

MrGodfrey

January 26, 2009, 12:04 am

@ Hank...





I am not "denying" anything - I just don't agree with you. And clearly I don't believe Sony to be indefensible, hence my defending them...





As a gamer I have in no way been (de)frauded by the PS3. Right mind or not, I thoroughly enjoyed MGS4 (there was some gameplay in between those cutscenes) and I had no prior interest in the series. I also have no complaints about Resistance, Uncharted, Assassin's Creed, GTA 4, Call of Duty 4 and 5, etc... I have played many of the same games on the 360, and found them... the same (though perhaps you will explain how I should be noticing how much better they are with the Microsoft magic). Now it's true, the 360 does have a big advantage... that advantage is called Gears of War. Otherwise, I am very happy with the PS3 as a gaming machine and with the games available for it.





Who cares about movie/media options? Me. I like the fact that it is both a gaming and a media machine.





Maybe you're outraged that Sony had the nerve to push Blu-Ray on you... personally I like being able to watch the occasional Blu-Ray movie without fitting a drive to my PC or buying an expensive standalone player. And you might think it's already a dead format, but downloading full HD movies is not always an option for those of without great connections and kindly ISPs. Blu-Ray is good for me.





Finally, you're not going to buy their products because they're going to lay people off in a recession? That is admirable - are you going to do the same with every other company that has to let people go?





Keep the knives out if you want - I'm getting my controller out instead.

prag fest

January 26, 2009, 12:33 am

We should be careful not to decend into another PS3 vs 360 debate. I own both and the brutal truth is they are pretty much the same, anyone would be happy with either purchase.





I guess my point was, it's a shame that Sony have a great product on their hands, but due to the mentality of their management, they have completely failed to exploit it's full potnetial. If they dont shake things up asap, it's not hard to them really slipping in the coming years.



smc8788

January 26, 2009, 12:47 am

@ hank.





You said you didn't want to get into PS3 vs. 360 but that's exactly what you did. Let me extend the argument a little further, I'm sure much to the dismay of many TR readers.





I would like to echo much of what MrGodfrey said. It's more a fact that their competitors have caught up and offer more competitive pricing than Sony's standards slipping, which I don't deny they have a bit.





Unfortunately Sony decided to release the most technologically advanced, if flawed, games console of this generation which seemed to catch many people off guard, including games developers. Add to this the fact that they were a full year late to the party and it meant that, while superior to its competitors on paper, it was not taken in as willingly as Microsoft's box, with people unwilling to part the extra cash for what they saw as two different systems offering exactly the same thing. The fact the cost was actually justified considering what was inside and actually closer to the Xbox spec for spec (when you consider the additional costs required to achieve the same functionality of the PS3 out of the box) than many people realise suggests something went seriously wrong in the sales and marketing department. The simple fact is people don't like to part with large sums of money in one go, and by adding all the extra functionality as standard with no cheaper option available they left themselves at the mercy of Microsoft, who offered the one thing many people wanted, playing games (which they both do equally well, BTW) but at a substantially cheaper cost. In a way the PS3 has achieved a rare thing in the world of technology, in that it has become more appealing as time passes. With prices coming back down to Earth, additional functionality added by frequent firmware updates (including the Marmite of the software world, Home), the prevail of Blu-ray, the higher reliability rates, and a few choice titles means that more people (at least the ones I know) are considering the PS3 a more attractive proposition than it was at launch.





Games are another issue as that is rather a matter of personal preference and are really just a tool to fan the flames of the fanboy fires. The fact is there are just as many exclusive games on both consoles that I would like to own (even though the vast majority are multiplatform, save for the ones Microsoft or Sony throw money into to keep), and I am sure that there are more single-console owners around that feel the same way, whether they like to admit it or not.





Well, that at least covers my opinion of the tiny proportion of Sony's endeavours that is the PS3. It would seem many believe the PS3 the most important piece of hardware Sony manufactures, and if that fails, then so will the company. Although it probably is in terms of the company's image, I'm quite sure the majority of their impending &#1633 billion loss lies outside of the Sony Computer Entertainment subsidiary.





Moving on, as for calling Blu-ray dead I think you're getting ahead of yourself a bit, or you have read the Tarot cards of home entertainment media. There is no superior physical format (don't talk to me about HD DVD, because that *is* dead) and rather than succeeding DVD I can rather see the two of them co-existing, as there will always be people people who want hi-def content and those who don't. Again, why do we need just the one format when both are good, but suit different people, and both have full industry support. In my mind it's not a straight comparison with VHS vs. DVD where one was superior to the other but required a completely different physical media.





/Rant. Phew.

hankb6d

January 26, 2009, 6:30 pm

@mrgodfrey + smc8788





Yes company policy dictates my purchases, it's not admirable, a company that makes dumb policies at non technical levels is equally going to make dumb policy choices at the forge. Something tells me that amongst the minnions and lay offs there are talented individuals who if they had a voice, could turn this Mary Celeste back round from choppy course.





Sony top brass haved scored some pathetic own goals on their flagship let me list them for you.





Blu Ray - the data transfer is piss poor which is not ideal for games, the much hyped about GB's of storage were never going to be, and never will be utilized fully for the games.





The Cell Processor - the decision was made to incorporate a bleeding edge processor, one that to get to grips with fully you needed to stop time and be more insane than a Harvard professor. Cue lengthy game delays, shoddy ports of existing IP's from other formats and increased development costs.





Home - Someone decided that gamers really want to live a "second life" and chill out with a virtual latte, chat to a middle aged man in teeny girl clothing, actually queue to play GTA inspired mini games in virtually bowling alleys.





PSN - It's free and not P2P but the functionality compared to XBL is laughable. The &#1633.33 monthly cost of XBL at full RRP is still value especially when the individual game publishers shutdown the servers as it suits, Konami are keen on that from my PS2 online experience of MGS3 some months after release the online was zapped.





I could go on about the PS3 - backwards compatibility, the amazing decision to remove rumble from the original dualshock controller, no VOIP at launch, no chatpad at launch, belated tacked on damn ugly peripherals, belated gamer "trophies", oh and if you went for the PS3 near launch and wanted some feedback you need to buy another dualshock. In other words you are paying for Sony's incompetence.





The games you mention Mr. Godfrey are mostly cross platform, identical but the PS3 has AA issues that's a big deal to some, not me, and the sony exclusives are not system sellers. Resistance2 sales are down on the original that speaks volumes.





Gears of War is not my genre and I have no intention of ever playing it but that backs up your point for Microsoft.


OK now movies, Sony in corporate wisdom decided to side with equally desperate hollywood studios to protect their stock and investments. The result was to harness HD and rip off consumers with their own format Blu Ray, Sony have a track record here with AAC audio format which is currently on a slow painful death against MP3/Itunes/WMA etc, another Sony exclusive cock up let's make our once superior Walkman range work on just our format, ignore the competition and consumer and grant ourselves a greed inspired deathwish.





Movies are generally something you watch once and in the odd case may repeat. I'm no movie buff, HD is irrelevant it's the same content only shiny. DVD/Blu ray sales are down. The latest overhyped film "Slumdog" has already revealed the storyline in desperate trailers, that I have no intention of caring about it let alone consider a purchase or night out maybe.





DVD's are now going roughly for &#1635 a shot in desperate retailers like HMV, they are doing a brisk business, that's some profit decline from the &#16320 heyday, the Blu Ray showcase stand, and the PS3 showcase stand look totally neglected, meanwhile youngsters are enjoying a game of football on the strange but true working 360. If you want to buy the Blu Ray movie for HD going for &#16320 you have ample shopspace to breathe easily you are in the minority. I queue behind some flame haired fugly girl snapping up her fantasy icon, Ally McBeal season's 1-8 for &#16319.99, would she be willing to pay extra for shiny pimples and not so watchable outtakes. I doubt it.





The premium of Blu Ray vs ISP gig cost is negligible, but you clearly advocate the cost of Blu Ray, I personally would be looking to change my ISP. My american friends who watch more movies than yours truly are going gaga over netflix, it's something I want. So my tarot cards do indeed predict Blu Ray is on a painful death. DVD is the clear choice and digital downloads the future.





Which is fine, you have a games console/BR player, I may be wrong, if I am I will stump up for a cheaper BR player that actually records in the future.





According to yourselves i'm a "fanboy", the same "fanboy" that shifted roughly twenty new PS2 installs to non gaming friends after they sampled Tekken on my machine way back in those much missed and much loved hazy days.





Well no i'm no fanboy, while I write this I have got to muscle up the pleasure of talking to some guy in India by name of "Brian" who will ask me for serial numbers, request that I turn my machine on/off and whether my Xbox is indeed plugged in.





Yes i'm a RROD victim, a furious one too, this Xbox is a refurb they sent me for a previous RROD and it's died within two months, it's manufacture is older than the original RROD which really angers me.





I'm so angry that I should look elsewhere, you make the most of the paltry PS3 price drop and indeed I will have to buy my games collection once again. NOT A CHANCE





No, I am considering buying another XBOX 360, I tell myself this is madness but I need my entertainment, the TV choice is laughable and movies don't do it.





This crazy situation shows just how much Sony ****** up.





A Fanboy? only your genius could possibly answer that.

Mad Iguana

January 26, 2009, 7:44 pm

Hank, you're an angry man.

hankb6d

January 26, 2009, 8:31 pm

@mad iguana





Yes, you're perfectly correct, i must get into cookery TV or non celebs or maybe even DVD's, is American Pie 26 out yet?





I still have to call "Bob" in India. I'm an addict I think, I'm worried too.

Mad Iguana

January 26, 2009, 9:40 pm

Good point Hank - everyone who disagrees with you is a brain-dead reality TV addict.


And it's all Sony's fault.

hankb6d

January 27, 2009, 1:43 am

@mad iguana





So good you totally missed it LOL





And no that's not Sony's fault, unless you make the Simon Cowell/Sony BMG connection, neither is the bricked XBOX which sits beside me.

Mickey5be

February 13, 2009, 1:15 pm

Since my favourite PC maker 'Dan' packed up I have only bought Sony laptops. However I hate the new glossy ones and want something similar in design to my trusty FE11S. As Sony laptops now resemble Samsungs I am now looking at the new Apple MacBook. if Sony want me back as a customer then they need to stop copying everyone else and go back to their forte, classy designs worth paying that bit extra for.

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