Sony Corp. on Thursday reversed its forecast for the full year from a ¥30 billion net profit to a ¥110 billion loss and said its electronics division will likely spend another year in the red.
It also said it will cut 5,000 more jobs to restructure the money-losing gadget business after culling about 10,000 jobs in fiscal 2012.
Sony continues to be weighed down by its loss-making computer and TV businesses.
As previously announced, Sony will sell its computer business to buyout firm Japan Industrial Partners Inc. But on Thursday, Sony said it also planned to turn its struggling TV business into a separate entity by July.
“As Sony’s CEO, I’ve been saying that my duty is to change Sony and reconstruct the electronics business and boost its growth, as well as grow the finance and entertainment businesses further to achieve stable management of the whole group,” Kazuo Hirai said in a news conference at its headquarters in Tokyo.
Sony made some unexpected financial adjustments, adding ¥20 billion in extra restructuring costs and reviewing its plan to sell off assets. It also booked ¥32.1 billion in impairment losses stemming from the long-term assets of its battery business.
The company also said its mobile, home entertainment and device sections weren’t doing as well as expected. Although smartphones are becoming a driving force for Sony, its electronics business has been struggling to sell its mainstay TVs and computers.
The electronics business lost ¥170 billion in fiscal 2011 and ¥134 billion in 2012, so getting it profitable was Sony’s priority this year.
“We’ve tried to reform our computer and TV businesses. . . . Unfortunately, the goal of getting them back into the black this fiscal year is unlikely,” Hirai said.
It’s long-suffering TV business is expected to post a 10th consecutive year in the red. But its computer business is no longer an issue, with Hirai saying Sony decided to focus on smartphones and tablets for the mobile era.
Japan Industrial Partners will start a new firm to take over the Vaio line and employ 250 to 300 Sony employees there.
Sony sold 7.6 million computers last fiscal year and expected to sell 7.5 million this year, a level that was later downgraded to 5.8 million.
And while the Vaio brand has a solid fan base, it has been struggling to expand market share at home and abroad. In 2012, Sony was sixth in the Japanese computer market with a 6.4 percent share, according to Tokyo-based MM Research Institute. Its global market share was 1.9 percent at the end of September, tracking firm IDC said.
In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.