Sony Records Larger Loss, Despite Game Division Profit

Officials from Sony Corp. have released details of the company’s fourth quarter and full year financial results, in which the largest loss in two years was reported. The net loss in the fourth quarter ended March 31st was ¥56.5 billion ($532m) or ¥59.40 ($0.56) per share, increased from a loss of ¥38.2 billion ($361m), or ¥41.23 ($0.39) the year before. However, the loss was less than the ¥70.3 billion ($664m) predicted by a survey of analysts at Bloomberg. The company has attributed the loss to falling prices of flat panel television and digital music players. Sales for the company were calculated at ¥1.70 trillion ($16.1bn), down from ¥1.77 trillion ($16.7bn) in 2004. The company’s operating loss decreased from ¥109.8 billion ($1.0bn) last year to ¥77.4 billion ($731m). These results were also better than expected results by analysts, who had predicted sales of ¥1.67 trillion ($15.8bn) and a ¥81.3 billion ($768m) operating loss. Sony’s video game division continues to be one of its more positive, with a ¥1.49 billion ($14.1m) operating profit in the fourth quarter, from a loss of ¥6.89 billion ($65.1m) the previous year. This compares to a loss of ¥99.4 billion($939m) for the electronics division, a loss of ¥2.6 billion ($24.6m) for music and a profit of ¥13.7 billion ($129m) for movies. Operating income for the games division fell 36.1 percent to ¥43.2 billion ($408m) due to a decline in hardware sales revenue and start-up expenses for the PSP, despite an increase in software sales revenue. For the year started April 1st, Sony has forecast net income of ¥80 billion ($756m). The PSP continues to be at the forefront of the company’s future plans, with 2.97 million units so far shipped (as opposed to sold). Sony expects to ship 12 million units of the PSP this fiscal year. Shipments of 12 million units are also expected for the PlayStation 2 in the next fiscal year, with a hardware sales drop of 6.5 percent this year being blamed on hardware shortages rather than a drop in demand.