Jan 29, 2009

Business - Sony's quarterly net profit tumbles 95 percent

Jay Alabaster

TOKYO – Sony Corp. said Thursday its net profit plunged 95 percent in the October-December quarter from a year earlier as poor sales of TVs, digital cameras and mobile phones sent its core electronics division into the red.

The Japanese electronics icon said net profit sank to 10.4 billion yen ($115.6 million) from 200.2 billion yen a year earlier during the fiscal third quarter. Revenues fell 25 percent to 2.15 trillion yen from 2.86 trillion yen.

Sony has repeatedly warned of its troubled finances over the past few weeks, and the dismal numbers were in line with analysts' predictions.

Last week, the company forecast it would report its a net loss for the fiscal year through March, its first annual loss in 14 years.

The earnings report showed the damage is greatest at its core electronics division, which accounts for over half of its total revenues and makes the brands for which it is best known — from Walkman music players to Bravia TV sets.

The division, long a dependable source of profit as the company struggled to turn around its entertainment and other businesses, booked a 15.9 billion yen operating loss during the October-December quarter. That period includes the key holiday shopping season, usually a boon for electronics sales.

The company said much of the loss was down to the poor performance of its mobile phone joint venture, Sony Ericsson.

Sony has announced some restructuring measures, including cutting 8,000 of its 185,000 jobs around the world and shuttering five or six plants — about 10 percent of its 57 factories.

But Chief Executive Howard Stringer told reporters a week ago that he had not gone far enough with cut costs and would work harder to combine the company's diverse businesses. At that time, Sony said that for the full year, it would slide into 150 billion yen net loss from 369.4 billion yen profit the previous year

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