TOKYO – Sony expects its net loss for the fiscal year ending March 31 will be more than double what it forecast two months ago.
The company now expects to report a net loss of ¥520 billion (US$6.4 billion) for the fiscal year just ended, it said Tuesday. Just two months ago, it forecast a net loss of ¥220 billion.
The struggling tech giant said the increase was due to large one-time tax expenses generated overseas, which will be booked in the later part of the fiscal year. It did not change its forecast for sales or operating income, which it has already said will also be down drastically from the year-earlier period.
Sony is due to officially report its annual earnings for the period next month.
The tax charges are mainly due to losses that have piled up in the U.S. in recent years, which have led to lower valuations for some of the company’s business assets, it said.
The massive tax hit is the latest bad news for what many consider to be Japan’s tech bellwether. Sony had strong hopes that it could reverse earlier losses last year, and as recently as July predicted it would be profitable.
Like many of its domestic peers, however, Sony was unable to overcome recent factors such as the strong yen and production disruptions from events including massive flooding in Thailand. It has also failed to turn around its struggling TV business, or generate the same kind of enthusiasm for its products among consumers as have rivals Apple and Samsung, which have both said they are on track for record profits.
But Sony also sounded a positive note for the current fiscal year, saying it aimed for a strong profit of ¥180 billion. New President and CEO Kazuo Hirai, who took the reigns this month, has restructured the company to focus on mobile products and network services. Hirai is due to address reporters on his corporate strategy in Tokyo on Thursday.