The consumer electronics and entertainment titan blamed falling prices on computer monitors and cellular phones, along with weaker sales in its music, electronics and insurance businesses.U.S.-listed shares of Sony (SNE) were off 3 7/16 to 68 7/8 in recent trading.
Jeffrey Pittsburg of Goldis-Pittsburg Institutional Services predicted during the period that Sony would trade around the 70 range over the next year or so. "I think it's getting hammered here with the yen-dollar relationship," he said. The analyst called fiscal 1998 a "year of transition" for the company.
Sony's electronics business slumped because of intense price competition and sluggish sales in Asia, Russia and Latin America - areas hit especially hard by the global financial crisis.
The company substantially lowered its profit forecast for the full year, citing the yen's rapid rise against the dollar and expected fallout from worldwide economic turmoil.
The company didn't break out feature-film results, but the six-month period was spotty at best for Columbia TriStar and Sony Pictures, especially compared with the same period in 1997, when Men in Black was well on its way to taking in more than $550 million in worldwide release. This year, Godzilla, budgeted at about $120 million, grossed just $136 million domestically. A more enthusiastic response overseas put the global total at $357 million, but the lizard epic still has to be viewed as something of a disappointment.
The Mask of Zorro came in just shy of the $100 million mark in the United States, a respectable total for the oft-filmed swashbuckler. But other films, including The Big Hit ($27 million) and Les Miserables ($14 million), could only be classified as bombs.
As reported, Sony Music Entertainment said a lack of big hits and rising costs cut into profits in its fiscal first half.
That Sony subsidiary took a loss from operatios of $7.4 million, compared with a profit of $72.5 million in the same period a year ago. The company blamed a combination of dropping sales and increased marketing expenses.
Western music sales were about flat, helped on the upside by Celine Dion's Let's Talk About Love album and by classical releases. But Japanese music revenues fell 22 percent. The company hopes things pick up in the fiscal second half on the strength of a Mariah Carey promotion and the increased popularity of certain Japanese artists.
Written By David B. Wilkerson