Less than a week after Sir Howard Springer, chairman and CEO of Sony (SNE), opened the Consumer Electronics Show (CES) with the comment, “I wish I could tell you I’m recession proof,” the company’s shares took a dive on reports that it will face its first annual operating loss in 14 years.
According to reports, Sony expects $1.1 billion in operating losses this fiscal year ending in March and that number could reach $2.2 billion. Sony didn’t comment.
The reports attributed the expected loss to Sony’s consumer electronics gear business, which sells cameras and TVs, among other things. But the company is also a major player in content, including movies and video games. According to the washingtonpost.com piece, other Sony divisions, such as its video game business, have offset its loses in other areas in the past, but now all areas are under fire.
Of course, Sony’s problems largely can be attributed to the recession and lower spending. And it’s well understood that it’s not just consumers, but businesses as well, who are becoming more cautious with their spending.
According to a Forrester Research report expected out today, global business and government spending on computer, software and communications products and consulting services is expected to decline 3 percent this year, marking the first decrease in this arena since 2002. On the upside, however, Forrester reportedly expects tech spending to recover in 2010 by as much as 9 percent.
