Things aren’t looking too hot for Sony CEO Howard Stringer. Back in October his company predicted that it would end its current fiscal year with an operating profit of $2.2-billion but a Japanese newspaper is reporting Sony is well on track for a loss of at least $1.1 billion. So what happened to Sony? For starters the Japanese economy, the second largest in the world, was one of hardest hit victims of the credit crunch. Japan’s largest stock market index, the Nikkei 225, ended 2008 down 50% from where it was back in June. Add to this the ongoing fear of deflation due to the rapidly strengthening Yen, soaring national debt, low consumer confidence and very bleak picture is painted of an economy that just doesn’t have the cash to be buying high-end consumer electronics. And of course it doesn’t help that every single nation in the Western world is having severe economic troubles of its own. The only positive thing going for Sony (if you can even call if that) is that its Q4 ends in March, meaning it has a couple more months to drastically cut costs. If Sony don’t make some fairly major moves, its losses on the year could rise to as much as $2-billion. Guess that means the $399 price tag on the PS3 isn’t going to come down any time soon.
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