In 2008, many companies that traditionally had high profits saw things change as the global economy went soft. Moving into 2009, the global economy hasn't changed and electronics firms that are traditionally profitable are now announcing that they could see a loss.
Sony is reportedly ready to announce only its second loss in the history of the company being publically traded. The first loss by Sony was in 1995 and was due to a major write down in the value of its U.S. based motion picture studio. Many analysts are predicting that Sony may report a massive operating loss of about $1.1 billion due to sluggish sales and a strong yen.
Sony shares dropped 9 percent in trading on the news cutting $2 billion from the firm's market value of $22 billion. Sony isn't alone though with other Japanese electronics firms looking at losses. Toshiba saw stock prices drop over 8 percent after media in Japan reported it was headed for a major loss this year as well.
Sony previously announced that it would restructure and cut 16,000 jobs worldwide with 8,000 of that number being full-time employees. That number is roughly 4 percent of Sony's global workforce.
Analyst Kazuhara Miura told CNN Money, "I think there's a good chance the company will further accelerate its restructuring from what has been announced in December."
Analysts feel that Sony will need to layoff even more employees than previously stated and perhaps even sell its financial unit that has been particularly hurt by the fall of stock prices. Sony had previously announced that it expected a profit of ¥200 billion. Sony officials have not commented on the reports at this time other than to say it did not issue the loss forecasts. Sony will talk about its financial state at the announcement of its quarterly earnings on January 29.
Sony has its hands in many markets with divisions ranging from Hollywood film studios to TVs and gaming systems like the PS2 and PS3. Sales of Sony's aging PS2 remain robust with a reported 50 million of the consoles sold in North America alone.
quote: Apple is losing money, their profits have fallen dramatically
quote: I know dirt poor people who will still buy Apple products, I can't say the same about Sony products
quote: This didn't have anything to do with the prices of their products.
quote: A strong yen, means less Sony products being exported to other countries for sales.
quote: For comparison, Samsungs most recent quarterly profits rose 37%, and panasonic is suppose to release their data soon, and they are also expected to see profits rise. So if what you are saying is true, why are the other big Japanese players not feeling the pinch?
quote: Also, i hate the way they changed the LCD TV Model this year. So many different lines and got everyone so confused.
quote: Also interesting in the internal architecture technology utilizing high-speed buses which surpasses any high-end PC offered today. If Linux could only access the Nvidia GSX processor, then game play on the PS3 would surpass any PC offering.
quote: Since I need to use VMWARE for some home projects