In the latest bad news for the Japanese electronics and entertainment company, Sony Corp yesterday reported a bigger group net loss for the January-March quarter compared to a year ago.
Battered by slumping sales and restructuring costs, Tokyo-based Sony recorded a group net loss of ¥56.5 billion (US$533 million) for the fourth quarter, worse than the loss one year earlier of ¥38.2 billion.
Sony, which also has key music, movie and video-game businesses, said in a statement that sales shrank 4.2 percent to ¥1.697 trillion (US$16 billion) from ¥1.772 trillion for the same quarter last year.
PHOTO: AFP
Sony has been fighting off growing competition in consumer electronics from cheaper Asian manufacturers, while falling behind other rivals in critical hits like the iPod from Apple Computer Inc. Sony has been struggling to make a turnaround, but the latest results show its recovery remains weak.
Still, profits at Sony improved for the full fiscal year ended March 31. Group net profit totaled ¥163.8 billion, nearly double the ¥88.5 billion earned the previous year. Sales dipped 4.5 percent to ¥7.16 trillion from ¥7.5 trillion.
For the year through March next year, Sony expects group net profit to fall 51 percent to ¥80 billion, while sales are forecast to edge up 4 percent to ¥7.45 trillion.
Sony, which booked ¥90 billion in restructuring-related charges last fiscal year, plans to book another ¥72 billion in such costs for the current fiscal year.
Sony is signing on a new management team, appointing Howard Stringer, who headed Sony's entertainment division, as the chief executive, replacing Nobuyuki Idei.
Stringer is the first foreigner to head the electronics company famous worldwide for the Walkman music player and PlayStation 2 video-game console.
Investors are counting on Stringer, the 63-year-old media executive who directed Sony's acquisition of Metro-Goldwyn-Mayer Inc, to cut costs and revive earnings growth amid falling prices of Wega televisions and Net Walkman music players. Sony, on a per-employee basis, makes about a fifth of the profit of Apple Computer and 6 percent of that at Samsung Electronics Co.
"Across Asia, consumer electronics makers are increasingly facing a margin compression because of rising competition and price-cuts to lure more customers," said Praveen Choudhary, a technology analyst at Morgan Stanley in Singapore. "Whether the companies can overcome this general trend depends on whether they can increase volume and introduce new products."
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