23 Jan 2009

Sony expects first loss in 14 years

6:11 am on 23 January 2009

Sony expects its first annual loss in 14 years as the global economic slowdown hits demand for its products.

For the financial year ending in March, Sony said it expects to make a net loss of 150 billion yen ($US1.7 billion).

The giant electronics company also blames a strong yen for making its exports more expensive.

Sony previously forecast as recently as October that it would make a profit this year. The BBC reports the expected loss was much bigger than analysts had anticipated.

Last year, Sony made a profit of 369.4 billion yen.

About 80% of its sales come from overseas. However, the yen is at a 13-and-a-half-year high against the dollar, which has eroded Sony's foreign earnings.

Other electronics companies are also suffering. South Korea's LG Electronics, which makes handsets and home appliances, reported its first loss in almost two years earlier on Thursday.

It made a net loss of 671.3 billion won ($US490 million) in the last three months of 2008.

However, Apple on Wednesday reported a record quarterly profit of $US1.61 billion in the final three months of last year, boosted by sales of iPhones and iPods.