Home » Forums » Game Culture » Console & PC Hardware Forum

8 replies [Last post]
ZippyDSMlee
ZippyDSMlee's picture
Offline
Joined: 2006-09-30

Sony May Post Biggest Loss in 4 Years on PlayStation 3 Consoles

By Hiroshi Suzuki

May 15 (Bloomberg) -- Sony Corp., the world's second-largest consumer electronics maker, may report its biggest quarterly loss in four years after the PlayStation 3 game console failed to spur as much demand as Nintendo Co.'s Wii player.

The net loss at Tokyo-based Sony may have widened to 75.8 billion yen ($630 million) in the fiscal fourth quarter ended March 31, from 66.5 billion yen a year earlier, according to the median estimate of 11 analysts surveyed by Bloomberg. Sales probably rose 9.5 percent to 2.02 trillion yen, the survey showed.

PlayStation 3 is being outsold by Wii by about two to one, causing Sony's game division, its second-largest by revenue, to post a fourth-quarter loss of 121 billion yen and a record 245 billion yen deficit for the fiscal year, according to five of the 11 analysts. The loss may exceed profits from electronics such as Bravia televisions, and the movie unit, whose ``Spider-Man 3'' generated record box-office sales when it opened this month.

``The extent of the recovery in the game business will be the main theme this fiscal year,'' said Naoki Fujiwara, who oversees $720 million at Shinkin Asset Management Co. in Tokyo.

Chief Executive Officer Howard Stringer, 65, who took over in 2005, promised to raise the company's percentage of annual operating profit, or sales minus the cost of goods sold and administrative expenses, to 5 percent of revenue by the end of March 2008. That would be the highest annual operating margin since the year ended 1999.

``This year will be the first time Stringer's management really comes under scrutiny,'' said Fujiwara.

Sony spokesman Shigenori Yoshida declined to comment for this article because the company reports earnings tomorrow.

Record Games Loss

Sony will probably fall short and generate an operating margin of 4.1 percent, according to the survey. Last fiscal year, Sony had an operating profit of 80 billion yen, or 1 percent of sales, the survey showed.

Production delays for PlayStation 3 have left Sony in third place in worldwide sales of the newest generation of consoles behind Nintendo's Wii and Microsoft Corp.'s Xbox 360. Sony is still the world's biggest console maker because of sales of its older PlayStation 2 machines.

Ken Kutaragi, developer of the PlayStation game consoles, will step down in June after production stumbles forced the company to slash shipment targets.

By comparison, Kyoto-based Nintendo last month reported profit in the company's latest quarter jumped sevenfold on sales of Wii consoles and portable DS game players. The company expects to sell 14 million Wii units this fiscal year, more than double the number sold in the previous year it was introduced. The Wii features a motion-sensor controller that allows a user to play virtual games of tennis and bowling, and costs about $250, half the price of the PlayStation 3.

Price Cuts

Sony sold 501,000 PlayStation 3 consoles in the U.S. from January to March, compared with Wii sales of 1.03 million, according to market researcher NPD Group Inc., based in Port Washington, New York. Microsoft sold 721,000 Xbox 360 players.

More than 205 million PlayStation and PlayStation 2 consoles have been sold worldwide since 1995. Sony in September cut the retail price of the PlayStation 3 in Japan before sales started.

The company also had to postpone the launch of the game machine in Europe by four months to March, because of a production delay in parts used in the Blu-ray DVD player used in the console.

``The 5 percent margin target is reachable if there is no price cut in the PS3,'' said Hitoshi Kuriyama, an analyst at Merrill Lynch Japan Securities Co., who has a ``buy'' rating on Sony. ``But I'm expecting a 20 percent price cut this fiscal year, and if that happens, the margin will not reach 5 percent.''

Bravias, Cyber-shots

Sony probably generated profit from all divisions other than games in the latest quarter, led by the consumer electronics business, as a weaker yen helped bolster sales of Bravia televisions and Cyber-shot digital cameras.

Operating profit from the consumer electronics division, second only to Matsu****a Electric Industrial Co. in terms of sales, will probably rise 43 percent to 283 billion yen this fiscal year, after climbing to 198 billion yen in the preceding 12-month period, according to the Bloomberg survey.

The weaker yen, which increases the value of overseas sales when repatriated back home, has helped Japanese exporters including Toyota Motor Corp. and Canon Inc. report higher profit in the latest quarter.

Spider-Man, Resident Evil

Profit from the movie division will probably rise 43 percent to 50 billion yen this fiscal year, boosted by ``Spider-Man 3'' and the third installment of ``Resident Evil'' featuring Milla Jovovich, according to the Bloomberg survey.

``The question is the balance between the electronics business and the game business,'' said Koichi Takatsuka, who oversees $1 billion at UAM Japan Inc. in Tokyo. ``And the question regarding Mr. Stringer is whether he is able to be a strong leader and show a clear vision.''

[url]http://www.vgchartz.com/forum/thread.php?id=1988&start=0[/url]

[url]http://digg.com/gaming_news/Sony_set_to_report_massive_losses_due_to_PS3_failure[/url]
======================================================

2 billion loss is not much if spider man is making a 50ish+ billion profit,the question is will sony finally give in and drop the price or continue the corporate madess ?

__________________

Ah modern gaming its like modern film only the watering down of fiction and characters is replaced with shallow and watered down mechanics, gimmicks and shiny-er "people".
------------------------------------------------------------------------
Incoherence is my friend and grammar my bane, which is the fulcrum of suffering I place upon others!:ZippyDSMlee
--------------------------------------------------------------------------
ZippyLabs

Forgot your password?
Username :
Password :

GameJobs Latest Openings

 

ECA Forums Shoutbox

You're not permitted to post shouts.
drclintcornellpacgtopsuv.com/2020-ram-2500/2018-12-11 15:42
Bonnibellehttps://www.bybit.com2018-11-30 04:28
amivaloasitumiv...https://txcatholic.org/forums/topic/nbcliveamerican-cup-2018-2018-live-stream-gymnastics/2018-03-03 14:39
amivaloasitumiv...https://txcatholic.org/forums/topic/fialivemexico-city-e-prix-2018-live-stream-race/2018-03-03 14:33
amivaloasitumiv...https://txcatholic.org/forums/topic/fialivemexico-city-e-prix-2018-live-stream-race/2018-03-03 14:32
MiaroseThese help to appreciate explosive climax. Males, Alpha force testo who are looking for how to enhance men power and stamina, are suggested to take these natural pills continually. http://supplementexamine.com/alpha-force-testo/2018-02-27 14:08
ginopropst55635...Link exchange is nothing else but it is simply placing the other person's webpage link on your page at appropriate place and other person will also do similar in support of you.2018-01-28 22:45
moriom505https://panthersvssaintslive.com https://billsvsjaguarslive.com2018-01-07 09:04
moriom505https://www.superrugbylivestream.com/2018-01-06 13:08
stator500https://canada-vssweden.com/ https://canadavs-swedenlive.com/ https://world-juniorsfinal.com/2018-01-05 10:44