Rumored Report: Sony May Post $1.1B Fiscal Yr. Loss

[jw]

rumored out of Japan, of course other big electronics manufacturers are facing the same dilemma such a M$, Toshiba and with the lagging economy this is to be expected

Tokyo — Sony may report its first operating loss in 14 years due to slowing sales of consumer electronics, according to anonymous sources in a story published by the Nikkei business newspaper, here.
The Nikkei story, which was picked up by various media sources, said it would report an operating loss of $1.1 billion (around 100 billion yen) when its current fiscal year ends on March 31. Predictably, Sony’s stock slipped almost 9 percent on the Tokyo Stock Exchange on Tuesday.
In December Sony did announce it would cut a total of 16,000 jobs, lower spending and close plants, which would save the same amount of money mentioned in The Nikkei story — $1.1 billion.
Sony, which will issue its fiscal third-quarter results on Jan. 29, had no comment on the story, only saying on its Web site, “Sony understands that a story appeared in the media regarding Sony's expectations on operating results for the fiscal year ending March 31, 2009. Sony has made no announcement in this regard and at this time has no further comment.”

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This story solidifys the loss in market wide and not just any one manufacturer

[york weir]

Ouch. The stockholders are not going to be happy.

[Maximus]

I wouldn't read too much into it. Much of what we are seeing is actually going to be good for the CE industry long term. It will make them more resilient to future recessions as it will force them to streamline production.

I actually think Sony will be affected the most as they are a premium brand, but eventually if things work out there will be a lot of consolidation in the CE industry and I fully expect Panasonic, Sony and Samsung to become super brands which own most of the industry.

[ouflak]

I'm not sure this really affects things much as far as Blu-ray is concerned. Everybody is feeling the current crunch, including all manufacturers of DVD and Blu-ray. So no competitive drawbacks really.

I suppose it's possible that Sony, since they are divested in electronics, media, and content, might be a bit more sensitive and likewise responsive to pressure felt across the entertainment industry in particular. But unless they somehow come to the conclusion that they would be making billions if it wasn't for Blu-ray, and that will never change as long as their investments into the format exist, I'm fairly certain things will go on business as usual.

Perhaps if the format fails to advance much further than its current market position, they might at some time take a more scrutinizing eye at their Blu-ray portfolio. But that likely wont' be for atleast another year or so, and I would think that that would likely affect the studios first, then the electronics i.e. PS3, SA's, before it affects the media content.

At this point, I think if Sony actually pulled out of Blu-ray alltogether (of everything except content ofcourse), there is more than enough support from various other companies to keep things going without them.

[FinalEvangelion]

Originally Posted by Maxpower1987

I wouldn't read too much into it. Much of what we are seeing is actually going to be good for the CE industry long term. It will make them more resilient to future recessions as it will force them to streamline production.

I actually think Sony will be affected the most as they are a premium brand, but eventually if things work out there will be a lot of consolidation in the CE industry and I fully expect Panasonic, Sony and Samsung to become super brands which own most of the industry.

So you think there will be a merger? I hope there is still competition. But, it sounds like there are too many players in the market right now for CE.

I don't think Blu-ray should be affected because it's brand independent.

[Blu-Benny]

isn't sony still taking a massive loss on each PS3 sold?? i thought i read that somewhere not long ago??

[york weir]

Originally Posted by Blu-Benny

isn't sony still taking a massive loss on each PS3 sold?? i thought i read that somewhere not long ago??

I think it's only like between $15 and $50 per console now. Of course when you're selling millions that does add up.

[Maximus]

Originally Posted by FinalEvangelion

So you think there will be a merger? I hope there is still competition. But, it sounds like there are too many players in the market right now for CE.

I don't think Blu-ray should be affected because it's brand independent.

I believe it will go the same way as the Airline industry. Where a few players own a lot of brands ranging from budget to premium.

The total amount of competition should stay similar to what it is now because the number of brands should stay the same, but the actual number of owners and expenses will decrease.

[CptGreedle]

That is no rumor... it was reported already.
But then again, we knew they were going to post something like that back in December.
Sony lost a lot this last year, mainly due to the economy. However, I think 2009 will be a good year for them. With PS3 sales up and the production prices down, BD sales skyrocketing, and the promise of a stabilizing economy in the near future, they should do very well this year.
But time will tell. If the economy continues to stay slow for longer than anticipated, than we may be watching many companies fall. However, BD isn't going anywhere. There is way too much support for it and demand. The worst possible outcome if Sony can't make a turn around would be to merge with another company.

[Sidewinder]

Originally Posted by york weir

I think it's only like between $15 and $50 per console now. Of course when you're selling millions that does add up.

I don't know how much they still lose per PS3 unit if at all, but in the console market this is nothing new or unusual, losing money on the hardware. They make up for it on the royalties and game sales.
Without the subsidizing of the consoles, PS3 and 360 would've cost maybe one or two hundred dollars more, which is definitely too much.

But of course at some point their hardware shouldn't sell at loss anymore. Even more so if the company is reporting a loss of 1.1 billion dollars.

[DRC72]

I'm not surprised given the economic difficulties people and companies are facing.

[nithr]

Originally Posted by jwbbud

rumored out of Japan, of course other big electronics manufacturers are facing the same dilemma such a M$

firstly ms is not an electronics manufacturer
secondly "M$"? are you 12 years old?
thirdly ms is making money unlike sony & co

[FendersRule]

Originally Posted by nithr

firstly ms is not an electronics manufacturer
secondly "M$"? are you 12 years old?
thirdly ms is making money unlike sony & co

Microsoft as a whole, or the Xbox division?

I bet the Xbox division is losing money. Last I've checked, in 2005, Microsoft was losing $100 per console. Find me some facts about the profits or deficits of the Xbox division to back up your claim please.

[Danger Boy]

Sony has been living pretty high on the old hog for many many years.. a 1st time loss in 14 yrs isn't that shocking really. Prob a drop in the old bucket.

I'd like to know what their profits were over those same 14 yrs. $xxx billions?

[Canada]

No matter how big a company you are $1.1 billion hurts

[Elandyll]

Given the economic circumstances, the situation of the Yen and the conditions for the CE market (TVs in particular), not a big surprise really.

What I find always more disturbing is a sort of "glee" that I perceive in the media reporting those kind of news for Sony.
Is it the PS2 era and Sony's total domination of that gen that makes them that way?

Or maybe I'm just imagining things... Dunno.

[saprano]

Originally Posted by Elandyll

Given the economic circumstances, the situation of the Yen and the conditions for the CE market (TVs in particular), not a big surprise really.

What I find always more disturbing is a sort of "glee" that I perceive in the media reporting those kind of news for Sony.
Is it the PS2 era and Sony's total domination of that gen that makes them that way?
Or maybe I'm just imagining things... Dunno.

Y.E.S....YES!

I always bring this up in every gaming forum, everyone is still upset( 360 fanboys, nintendo, fanboys, the media) from the ass beating sony gave everyone 10 years in a row. no one has ever done that before.

[steve1971]

With the way the economy has been this is no surprise that a mega giant like Sony would take a hit but this wont bother them to much. They will bounce back as they always do. They aint the only big corperation to hit a bump in the road I am sure Samsung, Panasonic and others have felt the pinch too. HECK everyone is right down to the average guy like me!!!!

[scweb13]

G4 reported yesterday that the number has been revised to $2.9 billion.

LINK

[Elandyll]

Yeah I've put a bunch of scary reports in Off Topic about this.
Seems (from those article) that there is also internal conflicts.