Sony operating profits fall 90pc in year of disasters

2 Nov 2011

Japanese consumer electronics giant Sony reported a 9.1pc decline in sales of US$20.4bn (1,575.0bn yen) during its second quarter, blaming falling consumer demand for LCD televisions, currency rates, as well as the effects of the floods in Thailand on operations.

The company recorded an operating loss of 1.6bn yen (US$21m), compared to operating income of 68.7bn yen in the same quarter of the previous fiscal year. The company said this was mainly due to a decrease in gross profit due to lower sales, an asset impairment associated with the anticipated sale of its small- and medium-sized display business, and the impairment of LCD television assets.

This will be the eighth annual set of losses in Sony’s TV division.

The technology giant is planning to split its TV business into three divisions: outsourcing, LCD TVs and next-generation TVs.

Earlier this year, Sony also became the victim of sustained hacker attacks that saw details of thousands of users of its PlayStation and PC games networks exposed online.

Last week, Sony announced it will acquire Ericsson’s 50pc stake in Sony Ericsson, making the mobile handset business a wholly-owned subsidiary of Sony, the companies have announced.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years