Sony expects massive net loss

2011-05-23 11:38

 Tokyo – Japan’s Sony expected to swing to a $3.2?billion (R22.4 billion) net loss for the fiscal year ended March, after delaying its corporate results to gauge damage from the March 11 earthquake and tsunami.

The latest setback for the technology and entertainment giant comes as it tries to recover from the impact of the disasters and a massive online hacking attack that compromised millions of users of its network services.

In a preliminary earnings statement today, Sony revised February’s forecast for a ¥70-billion net profit and now expects a net yearly loss of ¥260 billion ($3.2 billion), citing a charge for deferred tax assets.

The firm is due to report its full earnings on Thursday.

The technology and entertainment giant said consolidated sales and operating revenue are expected to be in line with February’s forecasts despite the impact of the earthquake and tsunami on production.

The maker of PlayStation consoles and Bravia televisions was forced to shutter plants after the disasters battered supply chains and damaged facilities.

The company said it would book a ¥360 billion non-cash deferred tax-asset related charge.

Cyber attacks in recent weeks involved the theft of personal data that include names, passwords and addresses from more than 100 million accounts on its PlayStation Network and Sony Online Entertainment services.

Sony shut down the PlayStation Network and Qriocity services on April 20.

The company has said it cannot rule out that millions of credit card numbers may have been compromised.

Today it said the data breach will result in at least a $170 million hit to operating profit this financial year in terms of insurance and damages costs.

Chief financial officer Masaru Kato said the estimate did not include costs related to possible lawsuits over the data breach.

“At this moment, we have not received any reports of credit card data being abused, but any such cases would change the cost estimated for the damage,” he told a news conference.

“There are some lawsuits being filed. These costs are not being factored in in the estimated damage.”

Sony has said it plans to fully restore PlayStation Network and Qriocity services by the end of the month.

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