Sony sees a record $6.4bn loss on tax hit

City A.M. Reporter
JAPAN’S Sony yesterday flagged a record $6.4bn (£4bn) annual net loss, double an earlier forecast and a fourth straight year of red ink, as it writes off deferred tax credits, heaping more pressure on its new CEO to turn around the electronics giant.

Sony, which plans to axe 10,000 jobs – around six per cent of its global workforce, has been hammered by weak demand for its televisions and overtaken by more innovative gadget rivals such as Apple and Samsung Electronics.

Yet, in a bid to ease investor concerns over its deteriorating bottom line, Sony forecast it would bounce back in the current year to end-March 2013 with an operating profit of 180bn yen (£1.3bn).

In a sign that Sony’s woes are industry-wide among Japan’s consumer electronics firms, LCD TV maker Sharp yesterday also raised its full-year net loss forecast - to 380bn yen from 290bn yen.

Kazuo Hirai, who took over as Sony’s CEO this month, has said he is prepared to take “painful steps” to revive the company, insisting he would not hesitate to scale back or withdraw from businesses he deemed uncompetitive. He will lay out his revival strategy in more detail at a briefing scheduled for tomorrow.