Sony is set to lose $6.4 billion dollars

So, Sony apparently lost a lot of money this last year.

Sony has warned investors that it's about to post its biggest loss ever. The company says it will lose a record $6.4 billion for the financial year ended March 31st, the biggest loss in the company's history, crowning a fourth straight year without profits.

Also apparently they are cutting 10,000 jobs. Don't know if that's already known. Let's hope Sony can pull through and get their company back on track. I wonder how this will affect the game division.

Source

None or very little of which is due to their games division apparently. Their TVs aren't selling.

It has always been their consumer electronics division. They produce too many products, and the ones that they do produce very well tend to be a bit overpriced. The reason why the company keeps dipping into SCE is because that is probably the only well run department in the whole corporation.

lol

Crazy how you can lose that much money and still be a company. Also, it just baffles me how they can lose that much money in one year when their products are usually fairly good. I could understand if a company makes shitty products, but $6.4 BILLION is a hell of a lot of money to lose and I really can't see what part of the company is losing that for them. Maybe it's just inefficiency because, you know, japan.

@DrDarkStryfe said:

It has always been their consumer electronics division. They produce too many products, and the ones that they do produce very well tend to be a bit overpriced. The reason why the company keeps dipping into SCE is because that is probably the only well run department in the whole corporation.

Yeah. I just wonder how many times they can depend on SCE to bail them out of even worse trouble.

That's what you get for assuming people buy TVs more often than once a decade.

@DoctorWelch said:

Crazy how you can lose that much money and still be a company. Also, it just baffles me how they can lose that much money in one year when their products are usually fairly good. I could understand if a company makes shitty products, but $6.4 BILLION is a hell of a lot of money to lose and I really can't see what part of the company is losing that for them. Maybe it's just inefficiency because, you know, japan.

It's pretty much all the TV and consumer electronics division. They put way too much money and resources for something that people don't go buy annually, or bi-annually like they do with Apple products.

They probably got some inflated returns as people were making the upgrade to HDTV. They looked at those returns and expected them to stay constant, but no. The majority of the population can tell the difference between 720 and 480, but 1080 to 720 or crazy ratios aren't the same kind of leap.

Yeah, I look at every non-console Sony product and feel like it's woefully overpriced. I can't be the only one. It's no surprise that their console division is about the only division worth a damn. I hope it's enough to keep them afloat in the coming console generation.

If this doesn't completely confirm the PS4 to follow the wii's route of modest hardware, I don't know what does.

Oh man the comments section is great for this article.

I genuinely laughed at this one.

"Lol, yes, because Microsoft and Nintendo sell large TV's and sound systems. Comparing these companies for anything more than games is just stupid. They've provided a decent game platform and been good competition in the games industry and I sincerely hope they can get on their feet again."

In Response: "Looks like SONY isn't selling them either! LOL!!!"

Sucks for Sony but they've been pushing 3-D way too hard. HDTV's just became a standard in most houses now you want us to go and buy 3-D TVs. Also the to me the Vita just didn't seem like a good move, they have a phone division right? Why not focus on that like MS is doing instead of putting out a only gaming portable devise.

If they didn't charge so much for their shoddily built, over priced electronics then this wouldn't be the case. Well, it might still be the case, but it probably wouldn't be so bad.

All the catastrophes Japan had probably didn't help either.

As stated, it's just because Sony makes way too much shit way too overpriced.

Their laptops here, in Canada, generally run a couple hundred bucks more than most others--and at that point, if someone can afford it, they'll probably get a Mac. Or they'll just go for another brand that's a better laptop.

HDTVs is obviously a big thing. With it becoming virtually a standard, a lot of people are perfectly content with Dynex and 'lower quality' HDTVs they can get at Best Buy and Wal-Mart for a couple hundred bucks. And, yeah, 3D TVs aren't a big thing.

For cameras, people like names: Canon and Nokia. I don't know enough about Sony cameras to say if they're good or not, but I've never had a problem with Canons or Nokias. And they're expensive. Sony cameras are even more expensive. And if you're going for a simple point-and-shoot, Sony is still wayyyyyyyyyy too expensive.

Their phone division, well... yeah, iPhone, Blackberry, smart phones, so on. The competition is just too much when it comes to phones, me thinks.

They just need to reign in things, and realize we aren't all BILLIONAIRES WHO WIPE OUR BUTTS WITH MONEY.

And I would hope this doesn't confirm 'modest hardware'. At least for me, if the PS4/Orbus/whatever isn't blow-your-tits-off amazing, then fuck it. If it isn't significantly better than the PS3, I have no interest. I obviously can't speak for EVERYONE IN THE WORLD, but generally, from what I've noticed, people aren't too high on spending a few hundred bucks on another system if it's a 'modest' upgrade on what we currently have. And I don't blame them. I feel if Sony doesn't go balls-out on the next generation, they're going to be losing a lot more money due to lost sales than the money they'd lose on research and development.

If Sony sold there TVs cheaper people would buy them.

Sony used to be a prestigious brand, but now it's just average. They still sell things at a premium price, however.

Well I don't know what the mystery to Sony is. Their competitors on the HDTV market are making nicer looking and higher spec TV's for considerably less than the Bravia series. At one point it was the shit to own a Sony TV, now it's Samsung, except apparently no one told Sony any of this and they're still strutting their stuff like it's 1999.

@Willtron said:

As stated, it's just because Sony makes way too much shit way too overpriced.

Their laptops here, in Canada, generally run a couple hundred bucks more than most others--and at that point, if someone can afford it, they'll probably get a Mac. Or they'll just go for another brand that's a better laptop.

Pretty much this. Sony is like a low rent version of Apple. They think way too highly of their brand and try to charge like it. This isn't the 80s anymore. Sony isn't nearly the premium brand that they used to be. Oh, and perhaps they ought to focus a little less on shoving proprietary formats down out throats and a little bit more time on just making a quality product.

Sony's not doing too badly with their phones in Europe since they moved to Android though. The Mini line was a massive hit here, offering a cheap basic smartphone in a small form factor for those who didn't want anything more. It's been a bit bumpy since then, but it seems the Arc S was well received as a mid-range phone, and the Xperia S looks like the next Android top model.

Actually, about $3BB of the loss is a US tax credit that they had to give up because they did not make profit to charge it against and arent foreseeing making enough in the US to use the tax credit. That's a paper loss really.

The rest comes from TVs and strong yen.

As for how they can lose so much and stay a company, Sony is an enormous and very rich company. It has equity (i.e. profits that they have accumulated from previous successful years) of $38BB. They are going to lose 16% of that equity this year, but they will probably make $2BB next year with the layoffs and restructuring. So dont worry about them too much. They would have to lose this much money for 6 years in a row to get in real trouble.

I think it's this ridiculous 3D push. People just don't want that crap. I see the Sony 3D TV bundle selling at Gamestop for like 350$ Canadian. So cheap, but still no one wants it.

They continue to charge more for products that are no longer superior to the competition and seem to think brand name will carry them. It won't. The higher-ups need a reality check.  When you walk into a store to look at TVs, and see 3 TVs, a Samsung, a Panasonic and a Sony, all look to be of the same quality and specifications but the Sony's $100 more than the other two, which are you going to choose? Probably not the Sony.

Sony TVs cost too much when compared to Samsung ones or at least they did the last two times people in my family bought a TV. They have been trying hard to push this 3D stuff too which nobody is going out to buy. Their laptops are also very expensive but their phones aren't so bad actually. Also as mentioned Sony is huge company with 168,200 employees, people talk about MS having deep pockets but Sony is no slouch. Still it's a terrible thing to lose ones job hope those people land on their feet.

@MikkaQ said:

That's what you get for assuming people buy TVs more often than once a decade.

They put way too much money and resources for something that people don't go buy annually, or bi-annually like they do with Apple products.

Hence Sony's big push for 3d tvs. Something else consumers didn't want, and aren't buying. I know no one who has one, in fact my friend recently bought a new 50" and went out his way to get one that wasn't 3d.

Noooooo. :/

@ninjakiller said:

@MikkaQ said:

That's what you get for assuming people buy TVs more often than once a decade.

They put way too much money and resources for something that people don't go buy annually, or bi-annually like they do with Apple products.

Hence Sony's big push for 3d tvs. Something else consumers didn't want, and aren't buying. I know no one who has one, in fact my friend recently bought a new 50" and went out his way to get one that wasn't 3d.

Yup. The 3D gaming push for the PS3 came entirely from the TV division cause they wanted to sell more TVs.

So glad it backfired.

You're just paying for their name ...not their quality. They do have a few quality products, most are over-priced junk with a Sony logo slapped on it.

@xyzygy said:

I think it's this ridiculous 3D push. People just don't want that crap. I see the Sony 3D TV bundle selling at Gamestop for like 350$ Canadian. So cheap, but still no one wants it.

This is along the same line I was thinking. Sony of today is not Sony of yesteryear. Sony used to be the shiznit, but somewhere along the line, they started playing catchup and investing in things consumers have no interest in. I mean they spent the last what? 1-2 years pushing 3D hard and no one gave a fuck, but they still kept at it.

Kaz realizes these problems (hence the restructuring). Hopefully he takes the initiative to do something about them. Stringer would have sat back and watched the company burn if he was still CEO.

Consolidate divisions, focus on key products, trim the fat, hire a new ad team. I'd say spin off Sony Pictures and Sony Music but apparently those divisions make a profit.

@Enigma777 said:

@ninjakiller said:

@MikkaQ said:

That's what you get for assuming people buy TVs more often than once a decade.

They put way too much money and resources for something that people don't go buy annually, or bi-annually like they do with Apple products.

Hence Sony's big push for 3d tvs. Something else consumers didn't want, and aren't buying. I know no one who has one, in fact my friend recently bought a new 50" and went out his way to get one that wasn't 3d.

Yup. The 3D gaming push for the PS3 came entirely from the TV division cause they wanted to sell more TVs.

So glad it backfired.

It is rather sad that Sony undertook the 3D push, but it points to the problems that companies who want to do everything will inevitably run into. Don't leverage your successful (or at least relatively successful) video game brands to buoy flailing sectors. Companies need to know when to back away and when to retract rather than dragging down the company as a whole with some kind of synergistic ad-speak. The 3D push distracted Sony's game division from other efforts it could have been making and since no one cared, Sony lost out more in the end.

I see the same kind of crap going on with MS right now and it makes me nervous. I don't want the crappy Metro - Windows 8 OS all over my Xbox. I don't want all my controls to be roped into using Kinect if it decreases overall functionality (like in Netflix). Just use what works and drop or revise what doesn't. Don't force it together and make everything suffer.

@BrockNRolla said:

@Enigma777 said:

@ninjakiller said:

@MikkaQ said:

That's what you get for assuming people buy TVs more often than once a decade.

They put way too much money and resources for something that people don't go buy annually, or bi-annually like they do with Apple products.

Hence Sony's big push for 3d tvs. Something else consumers didn't want, and aren't buying. I know no one who has one, in fact my friend recently bought a new 50" and went out his way to get one that wasn't 3d.

Yup. The 3D gaming push for the PS3 came entirely from the TV division cause they wanted to sell more TVs.

So glad it backfired.

It is rather sad that Sony undertook the 3D push, but it points to the problems that companies who want to do everything will inevitably run into. Don't leverage your successful (or at least relatively successful) video game brands to buoy flailing sectors. Companies need to know when to back away and when to retract rather than dragging down the company as a whole with some kind of synergistic ad-speak. The 3D push distracted Sony's game division from other efforts it could have been making and since no one cared, Sony lost out more in the end.

I see the same kind of crap going on with MS right now and it makes me nervous. I don't want the crappy Metro - Windows 8 OS all over my Xbox. I don't want all my controls to be roped into using Kinect if it decreases overall functionality (like in Netflix). Just use what works and drop or revise what doesn't. Don't force it together and make everything suffer.

I also remember how forced and awkward it felt when Zune branding kept creeping onto the Xbox, a pretty lame move to save the failing hardware.

It's time for Sony to stop thinking they are still that high-end boutique company that they were all those years ago and start pricing their products accordingly. Back in the day arguments could be made that their electronics were more innovative and of a higher quality than their competitors. Unfortunately for Sony most of those arguments do not hold true today yet they still price their products as though they do. 
 
I don't know anyone who does any research before purchasing that would actually buy a Sony television at regular price anymore.

@MikkaQ said:

@BrockNRolla said:

@Enigma777 said:

@ninjakiller said:

@MikkaQ said:

That's what you get for assuming people buy TVs more often than once a decade.

They put way too much money and resources for something that people don't go buy annually, or bi-annually like they do with Apple products.

Hence Sony's big push for 3d tvs. Something else consumers didn't want, and aren't buying. I know no one who has one, in fact my friend recently bought a new 50" and went out his way to get one that wasn't 3d.

Yup. The 3D gaming push for the PS3 came entirely from the TV division cause they wanted to sell more TVs.

So glad it backfired.

It is rather sad that Sony undertook the 3D push, but it points to the problems that companies who want to do everything will inevitably run into. Don't leverage your successful (or at least relatively successful) video game brands to buoy flailing sectors. Companies need to know when to back away and when to retract rather than dragging down the company as a whole with some kind of synergistic ad-speak. The 3D push distracted Sony's game division from other efforts it could have been making and since no one cared, Sony lost out more in the end.

I see the same kind of crap going on with MS right now and it makes me nervous. I don't want the crappy Metro - Windows 8 OS all over my Xbox. I don't want all my controls to be roped into using Kinect if it decreases overall functionality (like in Netflix). Just use what works and drop or revise what doesn't. Don't force it together and make everything suffer.

I also remember how forced and awkward it felt when Zune branding kept creeping onto the Xbox, a pretty lame move to save the failing hardware.

I'd already forgotten the Zune even existed as a piece of physical hardware. That's a great example.

FirebirdNF has the right of it. It could be interesting to see what the company does in the future. Would they drop sections of the company and focus on SCE? Maybe restructure the TV division to be cheaper like Dynex?

I think most gamers are just happy that SCE is doing well.

Pretty shocking that Sony had to turn around their message this late in the game to say their US profits would be so low that there wouldn't be an extra $3bn of tax paid (on which they could claim credits and so recover the tax at year end). How do you project your financials in such a way as to not see that coming? I'm genuinely shocked that the numbers can go that wrong, that quickly, considering the amount of money that has to move about to give you $3bn of tax to pay (or not pay, as in this case of unused credits) and it's either dodgy released estimates earlier in the year to try and put a positive spin or they totally failed to have a Christmas/Jan sale season for any of their product lines.

Eff Sony. I want a Nokia camera.

@BlackLagoon said:

Sony's not doing too badly with their phones in Europe since they moved to Android though. The Mini line was a massive hit here, offering a cheap basic smartphone in a small form factor for those who didn't want anything more. It's been a bit bumpy since then, but it seems the Arc S was well received as a mid-range phone, and the Xperia S looks like the next Android top model.

Sony Ericsson Xperia...

Sex sells.

lol 3D Tvs

Good. They make poor quality overpriced electronics, and they have the worst customer service I've ever experienced. Maybe this will be a wake-up call, but probably not.

Their TVs cost too much.

On paper that seems like a massive loss in profit but in reality for a company the size of Sony it's almost pocket change. One of it's greatest strengths as a company has been the fact Sony have invested in almost all areas of consumer electronics ranging from TV's, computers, games consoles, cameras, phones, sound systems and so on. The only thing I hope Sony take away from this is to just generally get more organised in how they support their products and launch new business ventures.

And to be fair I doubt the PSN hack helped the company's reputation either.

I think they should of asked people if they wanted to spend a grand on a 3D TV because they would of got a solid "No" from 95% of people and they could of saved themselves a lot of money.

@Hamz: I wouldn't call $6.4bn pocket change. I mean, they have a lot of revenue ($80bn each year recently, roughly) and assets ($168bn of assets against $139bn of liabilities) but they're not exactly a highly profitable operation (most revenue is a reflection of the cost to generate it, the curse of physical goods) and those liabilities are dragging down their ability to operate without concern about a large loss like this.

@Scooper said:

I think they should of asked people if they wanted to spend a grand on a 3D TV because they would of got a solid "No" from 95% of people and they could of saved themselves a lot of money.

3d huh?....gotta wear glasses for it to work you say.......extra glasses are a $100 a pop?........no more than 2 hours at a time or you might cause eye strain?....yeeeaaaahhhhh..you're fucking retarded Sony.

@Hamz said:

On paper that seems like a massive loss in profit but in reality for a company the size of Sony it's almost pocket change. One of it's greatest strengths as a company has been the fact Sony have invested in almost all areas of consumer electronics ranging from TV's, computers, games consoles, cameras, phones, sound systems and so on. The only thing I hope Sony take away from this is to just generally get more organised in how they support their products and launch new business ventures.

And to be fair I doubt the PSN hack helped the company's reputation either.

As much as investing in all those areas is a strength, at the same time it's also Sony's greatest weakness. So many of their divisions are failing miserably. And why? Because every division, it seems, has the same philosophy: overprice your shit way too much.

There's countless examples, so let's dig them up again.

Computers? At that price, people will buy a Mac if they can afford it. Or if they don't want a Mac, they'll get another computer from another brand for $1000 that will undoubtedly be better. A $1000 Sony computer is comparable to a $650, $700 computer from any other company. If you have that extra money, you're obviously going to go for the better computer, unless you're a fucking idiot.

Consoles? Only division that's doing really well--or well, relatively speaking.

TVs? The market is over-flooded with TVs. And Sony TVs are fucking expensive. 3D was a huge gamble and a loss, and like someone else stated, if you see two other TVs with basically the same specs for a hundred bucks cheaper, why not go with the cheaper one?

Sound systems? Eh. There's much better sound systems than Sony, if people are 'real' audiophiles. All sound systems, to me, are over-expensive. And if you're gonna go all-out with one, you'll probably get one better than a Sony.

Phones? The market, in North America, at least, is wayyyy over-flooded by other companies. Sony's lagging behind. Even with Android as a backer, Apple still fucks it up the ass. Blackberry gets the sloppy seconds. Maybe Samsung gets thirds? I dunno what Samsung's doing. None the less, Sony's still lagging behind.

Cameras? Again, the high-end market is dominated by Nikon and Canon. Those are better cameras, generally for a bit cheaper--even if they aren't better, they've got much more name-power than Sony does in the camera market. And point-and-shoots? People want cheap point-and-shoots. Sony doesn't make cheap point-and-shoots.

Pretty much they suck ass at selling everything but video games. TVs, computers, music players, radios?, phones. They put shit out that is not the best in any of those categories yet they have the mentality that was used with then PS3 first came out, "we say our shit is premium, so raise the price." Really, Sony thinks they are a luxury brand or something. Really their TVs suck ass. LG Samsung and Panasonic make better ones. Their computers are overpriced with the specs and don't even look that great.

I'm pretty sure the PS3 is the only competitive product Sony produces at this point.

That company is in dire straits.

Bummer