Sony posts record $1 billion loss for fiscal year 2008

As expected, Sony announced a record ¥98.9 billion ($1 billion) loss for the fiscal year ending in March 2009. This is Sony’s first reported yearly loss in 14 years and a significant change from the ¥369.4 billion profit Sony reported for the fiscal year ending in March 2008. Overall sales dropped 12.9 percent to ¥7.73 trillion during 2008 with US sales plummeting 20 percent, European sales slumping 17 percent and Japanese sales falling 14 percent. A small ray of hope in an otherwise bleak report were sales of the PlayStation 3 and the PlayStation portable, which both showed slight improvements. PS3 sales were up 10 percent YoY and PSP sales increased from 13.8 million the previous year to 14.1 million in the recently ending fiscal year. Though improving, sales of Sony gaming products still lag far behind those of Nintendo and Microsoft.

In an attempt to further lower its operating costs, Sony will continue with its previously announced work force reduction of 16,000 employees and will also close 3 plants in Japan, lowering its total number of plants to 49 from a high of 57 last year. Despite its cost cutting measures the outlook remains similarly bleak for the fiscal year ending in March 2010, with losses projected to be in the ballpark of ¥120 billion.

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