After announcing the slashing of 10,000 jobs earlier this week Sony has now confirmed that they are heading to a US$6.4 billion loss, with some analysts now questioning whether the Japanese company will be broken up.Sony, who is an extremely arrogant company who for years price gouged consumers in Australia and whose businesses sprawl from cameras and smartphones to PlayStation game consoles and movies such as “The Smurfs,” has struggled to regain the brand equity and creative flair that made it a dominant force in the global electronics industry in the 1980s and early 1990s.
The company that has not made a profit in four years is now facing their deepest loss in its 65-year history. Arch rivals Samsung, Apple, Google and LG are all highly profitable with Samsung reporting a $5.51 Billion profit for the past quarter last week.
Languishing from poor management decisions, a poor product portfolio and a fading brand, Sony has not made a profit in its television business for eight years.
“We consider the current situation to be very serious,” Sony Chief Financial Officer Masaru Kato said at a news conference Tuesday. “We will take resolute measures to transform our business without protecting any sacred cows.”
Chief Executive Kazuo Hirai who was appointed after years of poor management under Sir Howard Stringer, now Chairman, said last week that he will unveil a new strategy in an effort to turn around Sony. Hirai promised to make tough decisions necessary to return the company to profitability. Details of Mr. Hirai’s plan include reducing Sony’s work force by about 10,000 jobs, or 6% of its global total.
The losses, which will be a blow to Sony’s weakened balance sheet, comes as the Company struggles to get traction in the TV, gaming, PC and digital camera markets.
In an effort to try and compete with Apple and Samsung, Sony has moved to simply rebadging as “Sony” other companies products.
In the PC market Sony fails to design or manufacture their notebooks. In the TV market Sony recently cut a deal with LG to make their 3D TV screens.
In February, Sony projected an annual net loss of $2.7 billion amid weak TV sales, the strong yen and production disruptions from flooding in Thailand.
Hirai is due to outline the company’s new corporate strategy to journalists on Thursday.