Sony Corp yesterday said it would lose ¥230 billion (US$2.14 billion) this fiscal year, more than four times its earlier forecast as the Japanese electronics giant blamed a downturn in its mobile phone business.
The estimated net loss in the fiscal year to March next year came as a surprise only months after it tipped a loss of just ¥50 billion, citing a turnaround in its hard-hit television business.
Sony has cut expectations for sales in the smartphone business, which has been reporting operating losses as it faces off against global rivals including Apple Inc and South Korea’s Samsung Electronics Co.
Photo: Reuters
The announcement, which came after Japanese markets had closed, is likely to resurrect fears that the once world-leading electronics company has a lot more work ahead to cast off years of losses.
It also said it would not pay a year-end dividend for the first time since it started trading in Tokyo in 1958, according to the leading Nikkei business daily.
The company said it had “modified” its mid-range business plan (MRP) to “address the significant change in the market and competitive environment of the mobile business.”
“Under the new MRP, the overarching strategy for the [mobile] segment has been revised to reduce risk and volatility, and to deliver more stable profits,” Sony said in a statement. “This revision includes changing the strategy of the segment in certain geographical areas, concentrating on its premium lineup and reducing the number of models in its mid-range lineup.”
The new estimate will see Sony post a ¥40 billion operating loss — reversing earlier expectations for a ¥140 billion profit — on previously forecast sales of ¥7.8 trillion.
In May, the firm posted a bigger-than-expected loss of ¥128.37 billion in the fiscal year to March. That came several months after announcing 5,000 job cuts at its struggling computer and television units.
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