Sony slashes forecast to fourth straight loss

Markets Reuters

By Isabel Reynolds

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Sony

The maker of Bravia TVs, Vaio computers and PlayStation game consoles slashed its forecast to a net loss of 90 billion yen ($1.1 billion) from a net profit of 60 billion yen. It blamed the deluge in Thailand for cutting 25 billion yen in expected earnings and reduced its TV sales forecast by 9 percent to 20 million sets.

Sony, which also cut its full-year operating profit outlook by 90 percent to its lowest level in three years, said earlier this week that it would split its television business into three divisions of outsourcing, LCD TVs and next-generation TVs from November 1 in its latest attempt to turn around the loss-making operation.

Sony is also considering dissolving its flat-screen venture with Samsung Electronics Co, which will enable it to cut panel supply costs and improve its TV business earnings, according to sources familiar with the matter. It has yet, however, to unveil any plan.

The revised net forecast compares with market expectations of a 49.5 billion yen profit in a Thomson Reuters I/B/E/S poll of 18 analysts.

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Once a symbol of Japan's high-tech might, Sony is struggling to come up with hit devices and finds itself outmaneuvered in TVs by Samsung Electronics and in the booming smartphone market by Apple.

Sony is yet another addition to a lengthening list of Japanese firms that have posted poor quarterly results due to factors including the strong yen, floods in Thailand and weak demand in the United States and Europe.

The list includes names such as Honda Motor Co, Panasonic Corp, Nintendo Co Ltd and Nomura Holdings.

Sony posted an operating loss of 1.6 billion yen for the July-September period.

($1 = 78.280 Japanese Yen

(Additional reporting by James Topham; Editing by Miyoung Kim and Chris Gallagher)

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