Sony warns "worse to come" as it loses $1 billion

 

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By Stuart Turton

Posted on 14 May 2009 at 13:53

Sony has posted losses of 98.9 billion yen ($1 billion) for 2008, and warned there is worse to come.

The loss is the company's first in 14 years, but isn't quite as bad as Sony predicted back in January when chief executive Howard Stringer rattled a few cages by suggesting losses could be as high as $2.9 billion.

At the time Stringer railed against the board's resistance to the idea of restructuring the company, claiming they didn't share his "sense of urgency."

They almost certainly will now, especially with Stringer predicting that losses could widen to 120 billion yen for the 2009 financial year, which ends March.

This will include charges related to Stringer's tough restructuring plan, which will see around 16,000 jobs cut and the closure of eight manufacturing plants, including four in Japan and another four in the US, France, Mexico and Indonesia.

Stringer put Sony's poor performance down to plunging demand for electronic products including its flagship VAIO laptop brand and Bravia televisions. He also pointed a finger at the yen's strong performance against the dollar and euro.

The losses form a stark contrast to the same period last year, when Sony reported a 369.4 billion yen profit.