Just as analysts predicted
, the global recession has hit Sony hard, with the company reporting its first annual loss in 14 years. It lost 98.9 billion yen, or about $1 billion
, in the fiscal year through March 2009 and projected it would lose even more money this year amid a slump in consumer demand for electronics goods. This is in sharp contrast to profits of more than $3 billion recorded a year earlier by the electronics giant.
Sony is pushing through a restructuring program in order to get their finances back on track, which involves the closure of eight factories and eliminating some 8,000 jobs by year's end, mostly through forced retirement. The path to recovery is not one that will happen straight away, though, as Sony has projected a 120 billion yen ($1.2 billion) loss for the fiscal year through March 2010.
Like several other Japanese companies, their business has been hurt by the strong yen which makes exports more expensive. The company saw a sales drop in each segment. Electronics sales for instance, usually Sony’s bread and butter, were down 17 percent, while its gaming segment took an 18 percent hit despite stronger PlayStation 3 and PSP sales this year. Revenue from Sony Ericsson Mobile Communications, the company's mobile phones joint venture with Ericsson, also fell by 19 percent on account of lower volumes.