Sony rethinks SA strategy amid huge loss

Sony’s losses ballooned to 136 billion yen ($1.2 billion) last quarter as the Japanese electronics and entertainment company’s troubled mobile phone division reported huge red ink.

The Tokyo-based maker of the PlayStation 4 video game machines, Spider-Man movies and Xperia smartphones had reported a 19.6 billion yen loss for the same July-September period a year earlier.

The poor result released Friday was despite a 7% increase in quarterly sales to 1.9 trillion yen ($17.3 billion) as performance improved in cameras, TVs and game businesses.

It follows reports Sony South Africa is restructuring and will close its consumer audio/visual (CAV) business unit.

The CAV unit looks after Sony products such as cameras, televisions, and home audio.

Other divisions such as PlayStation (distributed by Ster-Kinekor) and Sony Mobile will not be affected, according to a Htxt report.

A Sony spokesperson stressed that the brand is not withdrawing from the country, while the company is looking into a new business model for some of Sony’s CAV products.

Sony told Htxt however, that up to 57 jobs could be lost during the restructuring process.

Last month, Sony wrote down the value of its mobile phone business by 176 billion ($1.6 billion). The mobile communications unit recorded a 172 billion yen ($1.6) operating loss for the quarter.

Sony stuck to its forecast for the year through March 2015 of a 230 billion yen ($2.1 billion) loss.

Sony has lost money in six of the seven past years, struggling amid intense competition from Apple Inc. of the US, Samsung Electronics Co. of South Korea and a host of other cheaper Asian rivals.

It has repeatedly promised turnarounds but failed to deliver, partly because even if one part of its sprawling business empire recovers, another area usually falters.

Under an overhaul announced earlier this year, Sony sold its Vaio computer business and is splitting off its TV division to run as a wholly-owned subsidiary.

Sony’s TV division has lost money for 10 years straight.

In Sony’s movie business, its lower theatrical revenue for the quarter was partially offset by higher home entertainment and TV licensing income, such as the home entertainment release of “The Amazing Spider-Man 2.”

Sony had a profitable fiscal first quarter, but that had been from the sales of its Tokyo property and its stake in a Tokyo game maker.

Reporting with Sapa

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