Earnings: Sony Down On Falling Gadget Sales, High Yen

Sony (NYSE: SNE) has announced a loss for the third consecutive quarter, two months after posting its first full-year loss in 14 years. The troubled tech giant made a net loss of 37.1 billion yen ($386 million) for the three months to June 30, its Q109 — compared to a 35 billion yen ($368.3 million) profit in the same period last year — thanks to consumer spending on gadgets falling by more than a quarter since last year. Revenue tumbled 19 percent year on year to 1.59 trillion yen ($16.6 billion).

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Gadgets, games sales fall: The Consumer Products & Devices division saw revenue fall 27 percent to 774 billion yen ($8.05 billion) and an operating loss of 2 billion yen ($20 million). Sales of TVs, digital cameras and video cameras have all declined and Sony is selling far fewer games products : just 1.1 million PS3s and 1.3 million PSPs were shipped in the quarter compared to 1.6 million and 3.7 million respectively in the same period last year.

High yen hurting: As in its last two quarterly earnings, the company blames the high price of the yen, restructuring charges caused by some serious cost-cutting and layoffs and the poor performance of equity affiliates for the slump. Those three factors contributed to operating losses of 118.7 billion yen ($1.24 billion). Its share in Sony Ericsson (NSDQ: ERIC) cost 14.5 billion yen ($151 million) while its 50 percent stake in Sony BMG cost 2.5 billion ($26.3 million). As for those cuts, the company is still busy chopping through 16,000 full- and part-time jobs and shutting factories in Asia and Europe to drop its global production capacity by 10 percent.

Analysts’ take: Park Hyun, of Seoul-based Prudential Investment & Securities, says rivals like Samung are having a better time right now (via Reuters.com): “Even taking into account the impact of the stronger yen, it appears Sony is lagging Korean peers in overall competitiveness.” Steve Lee of Seoul’s Goodmorning Shinhan Securities says the numbers were “better than the market had expected” and a “positive signal” for H2.

Movies, music lift: There is some good news: the company made 170 billion yen ($1.77 billion) in its Pictures division — a 15 percent lift in dollar terms — thanks to its Angels & Demons and Terminator: Salvation movies — plus Sony’s deal to broadcast the lucrative Indian Premier League cricket tournament was profitable despite expensive rights. On the music front, Sony makes a big increase after fully taking over Sony Music Entertainment from Bertelsmann. The world’s second largest music label made Sony 108.8 billion yen ($1.11 billion) — 96.1 percent more than it made from the Sony BMG JV in the same period last year.

Outlook Sony seems to continually downgrade its forecasts in the hope it can more easily beat them — so its shaving six percent from its full-year 2009-10 revenue forecast to 7.3 trillion ($76 billion) may be designed to make future losses look a little better. It’s predicting a 110 million yen ($1.15 million) loss for the year, which would be worse than its 2008-9 loss.