Sony Corporation has taken a hit financially. Sales decreased and losses were recorded due to factors including the slowdown of the global economy. Inserted below is a visual of Sony Corporation’s income statement (the Total Revenue and Gross Profit sections) period ending from 2007 thru 2009: (Yahoo! Finance) As illustrated Sony’s revenue at period ending decreased by $9,982,353 from March 2008 to March 2009 also, Sony’s gross profit decreased by $5,042,830. Therefore, Sony Corporation is having some difficulty earning profit due to the recession. For the electronic section of Sony sales decrease by 17.
0 percent which is said to be the negative impact of the appreciation of the yen against the U. S dollar and euro. For the game section there was a decrease of 18 percent year on year. The hardware for the game section overall decreased as well as the software for the hardware Sony sells. Sales of Sony’s Picture section decreased by 16. 4 percent primarily due to the lower home entertainment revenues of new release and catalog products. The Financial Services of Sony decreased 7. 4 percent year on year due to the decrease in the revenue at Sony Life.
Lastly, the All Other section of Sony increased 41. 2 percent year on year. This increase was primarily due to the fact that the results of Sony BMG were consolidated by Sony. During the fiscal year end March 31, 2009, with respect to all segments excluding the Financial Services segment, the major cash inflow factors included a cash contribution from net income. This was however after taking into account depreciation, and decreases in notes and accounts receivable. It exceeded cash outflow which included decreases in notes and accounts payable.
And the Financial Services segment generated net cash mainly from an increase in revenue from insurance premiums reflecting a steady increase in policy. Sony Corporation has announced a series of measures designed to improve its profitability and drive future growth in response to the deterioration of the global economy. There are three areas which Sony would like to focus on. First, structurally reform Sony’s core electronics operations to better compete with its best in class peers in terms of speed to market and profitability. Second, continue margin improvement activities to lessen the impact of the weak economic profile of key markets.
And third, accelerate the integration between products and network services by leveraging the combined strengths of Sony’s electronics and computer entertainment operations. With the changes above in mind Sony Corporations expectation for future growth is broken down by the four segments of Sony: Electronics, Game, Pictures and Financial Services. To begin, the Electronic segment does not have sight for future growth. It’s expected that a decrease in sales is expected mainly due to the continuing weakness in the business environment and the impact of the appreciation of the yen against the U.
S. dollar and the euro. Regarding operating income, Sony is expecting to reduce manufacturing costs and operating expenses. With these reductions in costs Sony expects to slightly increase their overall operating loss due to the increase in restructuring charges. Regarding future growth for Sony’s Game segment is slim to none. There is an expected decline in sales and is expected to negatively impact the appreciation of the yen. However for the Picture segment of Sony, the company anticipates higher revenue and operating income as a result of a greater number of major films to be released.
Lastly, regarding future growth in the Financial Services segment, Sony anticipates an increase in revenue and significant improvement in operating profitability. Sony Corporation has commercializes world’s first TransferJet Compatible LSIs. As of November 30, 2009 the consortium consists of 19 promoters and 22 adopters. TransferJet is a close proximity wireless technology enabling a high speed data transmission rate of 560 Mbps and eliminating major issues of current wireless technologies such as complex initial setup, unstable transmission or the need for access points.
TransferJet has adopted an intuitive interface consisting of simply bringing two products in close proximity. For example, one can display a picture simply by touching a digital camera to a TV, or transfer music files just by holding a cellular phone over a portable audio player. This technology is expected to be widely utilized as a high-speed universal interface connecting a variety of consumer electronic products. This is the world’s first product of its kind therefore issue are most likely to surface when it first hits the market although, this could be what Sony Corporations needs to help their quarterly revenues increase.