Sony expects full-year losses to reach ¥220 billion

Sony's Consumer Products and Services division, the unit that includes the PlayStation business, has suffered an operating loss of ¥85.7 billion ($1.09 billion) for the third quarter, compared to a profit of ¥63.5 billion for the same period last year.

Sales were down 24 per cent from ¥1.3 trillion to ¥996.5 billion ($12.7 billion) due to a price reduction on the PlayStation 3 and marketing costs that exceeded expectations, the company said. The division was also hit by declining sales of LCD televisions, the impact of floods in Thailand and unfavourable exchange rates.

Sales for the Sony Corporation overall were ¥1.82 trillion ($23.37 billion), down 17.4 per cent due, again to the floods in Thailand, "deterioration in market conditions" and the impact of foreign exchange rates.

The company recorded a net loss of ¥159 billion ($2 billion) compared to a profit of ¥72.3 billion for the same quarter in the previous year.

Sony has now increased full-year loss forecasts from ¥90 billion to ¥220 billion ($2.9 billion), with the company expected to make a loss for the fourth year in a row.

The numbers highlights the challenge facing new president and CEO Kaz Hirai, a veteran of the PlayStation business, who is now charged with turning around the manufacturer as it sees an eighth consecutive year of losses in its TV business.

During the third quarter Sony sold 6.5 million PlayStation 3 units, 2.4 million PSPs and 900,000 PlayStation 2 units.

It sold 66.2 million PlayStation 3 games, 11.4 PSP titles and 2.5 million games for the PS2.