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Sony Post ¥37.1 Billion First-Quarter Loss


Sony Post ¥37.1 Billion First-Quarter Loss

Sony didn't exactly have what you could call a good 2008 to 2009 financial year for 2008 to 2009 - reporting a ¥98.9 billion loss - and the first quarter of this financial year suggests things aren't getting much better. The damage? A net loss of ¥37.1 billion (£235 million).

Compared with last year's Q1 profit of ¥35 billion that's not a good sign for Sony. Some explanation is forthcoming in the 19.2 percent reduction in Sony's revenue, year on year, from ¥1.98 trillion to ¥1.6 trillion. The math savvy among you may notice that drop is a fair bit more than Sony's loss this quarter, suggesting Sony is adjusting to the current financial climate somewhat.

Unsurprisingly Sony is still blaming "the slowdown of the global economy and appreciation of the yen" on its less-than-ideal financial results. Restructuring expenses, which should ultimately lead to a reduction in Sony's costs also took their toll. If the result is wider PlayStation Network availability and touchscreen Vaios, however, it should be money well spent.

Sony is predicting a ¥120 billion loss for this current financial year outwardly, but Sony seems keen to better those (likely conservative) estimates. CFO, Nobuyuki Oneda, says that: "Internally, we are aiming to at least break even."

I'm almost inclined to think such hopes might not be entirely far fetched. Windows 7's release is just around the corner - and is likely to boost PC sales - while the PlayStation division is having a better time of things - the PS3 finally seeing the appreciation some of us would argue it has always deserved - and that's forgetting that the number of great Walkman, Bravia and other products Sony has produced recently, or is brining out soon.

In other words, you'd be silly to write Sony off just now.


Sony Investor Relations.

Go to comments


August 1, 2009, 8:42 am

<p>It should be mentioned that Sony booked around 30bn JPY worth of restructuring costs over Q1, and analyst expectations were for an 80bn JPY loss compared to the actual loss of 37bn.<br><br><br><br><br><br>Also Sony&amp;#039;s CFO when pressed mentioned that PS3 costs have come down by 70% since launch, putting the build cost at around 25-27k JPY.<br><br><br><br><br><br>Finally, word has it that OLED is coming in 2010 in 27&amp;quot; and 37&amp;quot; which should be very nice as no other major manufacturer has OLED lined up until 2011 (unless you count LG of course, but I would venture that they won&amp;#039;t pose serious competition).</p>

Tim Sutton

August 2, 2009, 4:29 am

<p>@ Max<br><br><br><br><br><br>Yes, the results were not as bad as the worst estimates. But that&amp;#039;s a bit like being happy because the sewage doesn&amp;#039;t quite cover your head; you&amp;#039;re still deep in the sh.. in trouble.<br><br><br><br><br><br>I think it&amp;#039;s likely the 70% reduction in PS3 production costs (and I take that figure with a HUGE pinch of salt) applies to the new slimline PS3 rather than the existing hardware. My reasoning is the still huge loss (USD 612m) posted by Sony&amp;#039;s game division, despite increased PS3 sales year on year.<br><br><br><br><br><br>A 70% cost reduction on a unit costing $900 to produce at launch leaves it costing Sony $270, leaving a healthy profit on a console retailing at $400+.. I don&amp;#039;t think that figure gells with the results Sony have posted.<br><br><br><br><br><br>I&amp;#039;m sure Sony will turn things around eventually, but I wouldn&amp;#039;t buy any shares just yet. Surely it&amp;#039;s almost time for them to introduce yet another hugely unpopular proprietary format, and that&amp;#039;ll REALLY put their stock in the toilet.</p>

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