Sony reported a double-digit gain in sales but a deeper net loss for its fiscal fourth quarter due to operating increases in its game division with "strategic price points lower than production costs" and "severe price competition" in its electronics segment.
Sales for the quarter were $17.7 billion, up 12.6 percent, due to increased sales of Bravia LCD TVs, Vaio PCs, Handycam video cameras and the launch of PlayStation3. Sales of rear-projection LCDs, CRT TVs and PlayStation2 decreased during the quarter, which ended March 31.
Sony reported a net loss of $573 million for the quarter, about $8.62 million deeper than the previous fiscal fourth quarter. Its operating loss for the quarter was wider by about a half to $961 million, and the loss before taxes was also about a half greater compared to last year at $896 million.
For its fiscal year, ended March 31, Sony reported that company-wide sales were up 10.5 percent to $70.3 billion, net income was up 2.2 percent to $1.07 billion while its operating income was down 68.3 percent to $608 million.
In its electronics segment for the year, Sony's sales and operating revenue were up 16.9 percent in yen reaching $51.3 billion during the fiscal year while operating income was up dramatically, over 2000 percent in yen, or $1.33 billion.
Sony said operating income was up even though there was a $434 million provision during its fiscal second quarter for charges related to the notebook computer battery pack recalls and replacement program. Sony also benefited due to the depreciation of the yen vs. the U.S. dollar and the Euro.
Sony also reported that 24 percent of its electronics sales during its fiscal year were from the United States, representing a 4 percent gain in local currency and an 8 percent gain overall. The leading reason for the increase was LCD TVs.
In its game area sales and operating revenue is reported up 6.1 percent in yen to $8.62 billion, but it posted an operating loss of $1.99 billion vs. a slight profit of over $70,000 during the previous fiscal year. Lower demand for PS2 hardware, in anticipation of the introduction of PS3, and price cuts for both systems were reasons for the operating loss.