Sony's Net Profit Plummets 95%, Games Division In Particular Disappoints

Authored by Jay Baage on January 29, 2009 - 12:08pm.

Tokyo, Japan - In line with what the company announced last week, electronics and media giant Sony today reported its first annual losses in 14 years on Thursday. The net loss amounts to Y10.4 billion ($115.6 million) for the October-December 2008 period, which represents a 95% drop in profits when compared the same period the previous year. The biggest disappointment came from the games division, which reported a 97% drop in operating profit, to Y400 million ($4.4 million), mainly due to declining sales of PS3, PS2 and PSP hardware and PS2 and PSP software.

The Japanese company said sales in total decreased 24.6 percent year over year as its electronics division sales plunged 29.3 percent in the wake of yen appreciation, the economic downturn, and intensified price competition.
"From the second half of September last year, there has been a sudden deterioration in the economy, and with the effects of foreign exchange it has had severe consequences on our business," Sony Chief Financial Officer Nobuyuki Oneda said in an Associated Press report.

Sony hasn't kept up with Apple on the digital-music front or with Nintendo on the video-game console front, according to Michael Gartenberg, an independent technology analyst which Yahoo Tech has spoken to.
"Look at the last quarter. Apple sold more iPods than they ever sold before and Nintendo sold more Wiis than they ever sold before. So consumers are spending money in some places, but they are not spending it every place," Gartenberg said. "Consumers are looking for long-term perceived value, and this is something Sony is going to have to work on."

Related Links:
http://tech.yahoo.com/news/nf/20090129/tc_nf/64395
http://www.variety.com/article/VR1117999234.html?categoryid=13&cs=1
http://www.sony.net/

Published in DMW Daily, January 29, 2009

Previous story: Google TV Ads Start Selling NBC Universal Inventory

Email this page

Comments

Sony's Problem

Submitted by anonymous (not verified) on February 3, 2009 - 5:18am.

Sony isn't giving people a reason to buy AND USE their products. For example, instead of allowing the PS3 to access Amazon Unbox or Netflix, they are hording it for the PS3 Network. One BIG reason not to buy the PS3. They are NOT allowing the PS3 to be that usable central media center device it was promised to be. Plus, in product lines they've cut features, and their previously aesthetically pleasing designs have disappeared. They have nothing special, nothing to set them apart on the shelves.