Sony Earnings Down

[Justin Buser]

Latest reports from Sony show slow earnings, and plummeting profits.

Their gaming side of the business is still doing very well though:

For its first quarter ended June 30, 2005, Sony Corporation reports a net loss of 7.3 billion yen ($65.2 million), compared to a profit of 23.3 billion yen in the same period last year. The company saw sales of 1.56 trillion yen ($13.9 billion), a 3.3% drop from last year's 1.61 trillion yen.



The company cites quickly-dropping television prices, as well as major restructuring costs, in explaining its low earnings. More significantly, Sony is now projecting yearly net income of 10 billion yen ($89.3 million), a drastic reduction from the 80 billion yen ($714 million) forecast in April.

Looking at Sony's game division, the picture's a bit more cheerful. That division saw sales of 172.8 billion yen ($1.54 billion), a 64% increase from last year. However, the group also saw a 5.9 billion yen ($52.7 million) operating loss -- attributed to marketing and research -- compared to last year's 2.9 billion yen.

Brisk hardware performance explains the game division's bustling sales numbers. The PlayStation Portable, Sony's spunky newcomer, sold 2.09 million units worldwide, while the PlayStation 2 sold 3.53 million units -- nearly five times as many as last year.

Foreigner Howard Stringer (a dual British-American citizen) stepped in as chairman of Sony in March. Stringer has said he plans major cost cuts at the company, which faces increasing competition from the likes Samsung and Apple. Stringer plans to unveil a turnaround plan in September.

Source: IGN