PS3, PSP problems force Sony to slash profit forecasts

***wraggster*** · October 19th, 2006, 16:41

News via GIBiz

The PlayStation 3 price reduction in Japan and a delay to the hardware launch in Europe have forced Sony Corp to reduce its income forecasts for 2007, along with poor performance of the PSP handheld and the continuing problems encountered from a worldwide recall of notebook batteries.

For the year ending March 2007, Sony expects a 38 per cent drop in net income, adjusting the previous forecast from 130 billion yen (EUR 872 million) to 80 billion yen (EUR 573 million). Operating income has been reduced from 130 billion yen to 50 billion (EUR 336 million).

"A decrease in sales and an increase in operating loss are expected within the Game segment as a result of the reduction of the retail price of PlayStation 3 hardware in Japan and the fact that sales and profitability from the PSP business are expected to be lower than originally forecast," said the company in an official statement.

Sony also admitted a "decreased operating income is anticipated within the Electronics segment due to a production adjustment of devices for use in PS3, including semiconductors."

"With regard to PS3, although we expect to record a loss for the business during its initial launch phase within the current fiscal year, we look forward to the successful worldwide deployment and expansion of the platform," said the manufacturer.

"As a result, we expect that we can realise a significant improvement in profitability during the fiscal year ending March 31st, 2008."

Sony announced at last months' Tokyo Game Show that the price of the Japanese PlayStation 3 was to be reduced from 62,790 yen (EUR 421) to 49,980 yen (EUR 335) for the 20GB unit.

**NovaKane** · October 19th, 2006, 16:52

That would be great if they reduced the US price as well. If they reduced the 20GB PS3 price in Japan, I hope they do the same with 60GB version. You know, the one everyone would rather have...step your game up Sony.

**Ichijoe** · October 19th, 2006, 17:00

Boo-Hoo! Shall we have a Pity Party for S0NY™?
First the infect People's PCs' with there filthy DRM & Spyware Package, and refuses to ship the PS3™ to Europe (Until next Year!), and pown us with exploding Laptop Batteries™!!

...It would appear like S0NY™ may have some Leadership problems. Hopefully they can find someone more competent the the Jerk whos running it now!

But, to top it all off you're looking at something nearing Seven Bills! Before you could even think of acquiring One of there supper soaraway PS3s'™. (Top-End After the min requiered 2x Game Tax! al-la the PSP™).

At this point I'd say to Hell with S0NY™!!!

**The_Ultimate_Eggman** · October 19th, 2006, 17:37

*sniff*sniff* i reall feel sorry for $ONY.NOT they deserve everthy thing they get or NOT as the profits show roll on p$3 and the next financial year hope its worse for them.Long live the homebrew scene.

**808** · October 19th, 2006, 18:41

Why do you need to feel sorry for them? 80 billion yen is still a ridiculously huge sum of money and they'll no doubt recover it soon enough.

**mcvader** · October 19th, 2006, 18:47

How is sony going bankrupt gonna help the hombrew scene?

Sure sony have fked up a bit/lot recently but like all other company's they're tryng to make money, it's hard to do that and make everybody happy at the same time.

A lot of people were pissed at sega during the saturn/dreamcast years and now that they're as good as gone people mourn the loss of one of the greats, I for one don't want that to happen to sony as well.

besides all that sony's a long way from going broke anyway, so don't get too excited.

P.S. I am not in anyway a sony fanboy.

**mr_nick666** · October 19th, 2006, 18:52

Id like to add they also lost the sale of a PS3 to me too (not sure they added that into their figures)

**DraconumPB** · October 19th, 2006, 18:59

So who here's getting a Wii? =)

**Mr.Denny** · October 19th, 2006, 19:00

Youch

Still, i`m getting tired of gaming recently. All these messy fight about "our system is better than yours!" gets old after years of gaming. I rarely get hooked on a game like i used to but i am looking forward to the Wii and Bioshock.

The PS3 was never an option for me, it`s too much more of the same. I want a new way of playing games rather than having hi-res HD jabber jabber visuals.