Sony Corp. on Friday revised downward its earnings projections for fiscal 2001, reflecting the global economic slowdown led by a slumping information technology sector and the recent attacks in the United States.
According to the revised projections, Sony will post consolidated pretax profits of 70 billion yen for the business year, down 65 percent from a projection in July.
The major electronics maker also said it will accelerate restructuring by cutting more than 5,000 jobs worldwide by March 31, the end of its 2001 business year.
The company had planned to cut about 10 percent of its group workforce, or about 18,000 employees, by the end of fiscal 2003.
Its consolidated operating profits will also fall 52 percent to 120 billion yen and its consolidated net profits will decrease 88.9 percent from the previous forecast to 10 billion yen.
Group sales will come to 7.5 trillion yen from an earlier projection of 7.7 trillion yen.
The job cuts will cost about 20 billion yen for retirement allowances. Other restructuring activities, including scrapping of unprofitable businesses, will cost another 30 billion yen in fiscal 2001, said Teruhisa Tokunaka, Sony's chief financial officer.
Sony President Kunitake Ando said the global economic slump has had a negative impact on Sony's electronics businesses, pointing out that its sales of electronics devices and products in Japan for fiscal 2001 are expected to decrease a few percent on a year-on-year basis and its sales in the U.S. will fall about 10 percent.
The company did not disclose its estimates of how much the Sept. 11 terrorist attacks in the U.S. may impact its earnings.