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Sony Cuts Guidance 38%, Gaming Division Losing Money

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Sony is expecting to close 2008 with a net profit 38% lower than was expected, with the company's games division actively losing money for the electronics and entertainment giant.

"The Japanese firm's outlook is bleak," wrote Forbes, citing a surging Japanese yen as hurting Sony's ability to export its products. Added to that, currency exchanges favor Korean rivals in consumer electronics, Sony's bread-and-butter products.

Video games are part of Sony's problem, as the games division has failed to recoup the PlayStation 3's $3 billion development cost and hardware losses despite what Forbes refers to as "early 2008 promises of profits."

Sony's overall profit tanked in its Q2 (July-September), dropping by half to 73.7 billion yen ($754.9 million)--and 60.7 billion of that yen came from one-time sales of some of its holdings.

"This is just the beginning of a big earnings collapse," said a Tokyo analyst to Forbes, speaking anonymously. "Given the track record of this company, it will under-deliver all the way."

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From The Chatty
  • reply
    October 23, 2008 10:00 AM

    Ouch, looks like we are stuck with the current generation of consoles for long long time.

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      October 23, 2008 10:04 AM

      Good. MS forced this generation too early.

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      October 23, 2008 10:08 AM

      Fine with me

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      October 23, 2008 10:08 AM

      Works for me, I have a smokin' fast gaming PC and I'm more than happy with my 360, as well.

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      October 23, 2008 10:11 AM

      Heh, you want a reboot already?

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      October 23, 2008 10:12 AM

      Best news yet. Now maybe devs will focus on gameplay rather than learning a new console.

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        October 23, 2008 10:41 AM

        More RAM and disc space would be very welcome though. And fillrate. We're on our 3rd 360 game, when we ship that'll be 6 years on one platform. If there's still no new platform on the horizon then that's another game and 8 or 9 in total.

        That sure seems like plenty of time without hardware progress to me! 8 or 9 years!

    • reply
      October 23, 2008 10:37 AM

      Yeah. 10 years, remember?

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