Costly Spider-Man, Elderly PlayStation Sink Sony Profits

Discussion in 'Current Events' started by MacNut, May 8, 2004.

  1. MacNut macrumors Core


    Jan 4, 2002
    Costly Spider-Man, Elderly PlayStation Sink Sony Profits

    TOKYO (May 6) - Sony Corp. may post a group operating loss for the April-June quarter amid falling prices for the PlayStation 2 game console and promotion costs for the new Spider-man movie, the company said Thursday.

    Dropping prices for electronics may also squeeze the company's bottom line, a Sony spokesman said.

    The projected loss would contrast with an operating profit of 16.7 billion yen in last year's April-June period at the electronics and entertainment conglomerate.

    Still, Sony doesn't formally forecast earnings on a quarterly basis and the projection is not definitive, company spokesman Gerald Cavanagh said. The company will report April-June earnings in July.

    Cavanagh added the quarter tends to be a slow period at Sony, where the year's earnings are often primarily realized in the October-December quarter that includes the Christmas season.

    For the full year through March, Sony estimates its group operating profit will jump 62 percent to 160 billion yen ($1.47 billion.)

    For April-June alone, however, the combination of higher costs and dropping prices may tip the company into the red.

    The PlayStation 2 has already been on the market for several years, prompting the company to cut its price to spur sales.

    Although Sony won't release ''Spider-Man 2'' in the United States until the Fourth of July weekend, a large share of the advertising costs for the movie will be recorded during the April-June quarter.

    Analysts say Sony, like other electronics manufacturers, will benefit from fast-growing sales of digital cameras, televisions and DVD players. But they say a strong profit recovery is unlikely before Sony completes a three-year restructuring and launches a series of new consumer products.

    The company plans to release a new handheld video-game device called ''PlayStation Portable'' or ''PSP,'' in Japan by the end of 2004 and in the U.S. and Europe by the end of March 2005.

    Sony is expected to unveil a prototype of the gadget - a hand-held player for games, videos and music - on May 11, ahead of the E3 video-game show in Los Angeles, the Asian Wall Street Journal reported on Thursday.

Share This Page