Sony Posts Deep Q4 Loss; PS2 Helps Buoy Company

Profits climbed to 115.5 billion yen ($963 million) for the year, up sharply from 15.3 billion yen last year. Yet sales declined during the year, concerning investors. The company's revenues fell to 7.47 trillion yen ($62 billion), down from 7.58 trillion yen last year. What was especially worrisome was Sony's performance in Q4. The company posted a 111.1 billion yen ($922.2 million) net loss for the January-March quarter -- its worst quarterly loss in over eight years. Looking at the game division's performance during the fiscal year, operating income climbed 36 percent to 113 billion yen ($942 million), although revenue dropped nearly 5 percent to 955 billion yen ($8 billion). This occurred as high-margin game sales surged in relation to sales of its lower-margin hardware. Fortunately its hardware business got some help, as manufacturing costs helped offset PS2 price cuts that occurred during the year. Sony said it shipped 22.5 million PS2 units during the fiscal year, and that 51.2 million units have shipped globally since the PS2 debuted. But Sony believes that the PS2 hardware market has hit its apex, and that sales will start declining. It believes it will ship 20 million units this year.