Sony is warning that it will have another steep decline in profits, which suggests that chief executive Kazuo Hirai might be making a trip to the car park, writing a haiku about the briefness of life before hacking into his stomach with a steak knife while his secretary covers him with cherry blossom.
Hirai is not fulfilling the promises he made upon becoming Shogun of the electronics giant two years ago to push electronics into the black. There is also his five cuts to earnings guidance during his reign and this is just two weeks before Sony announces full year results.
What makes matters worse is that he is doing all this while rebuffing advice from billionaire hedge fund manager Daniel Loeb’s to spin off Sony’s profitable entertainment business.
Sony cut its forecast for operating profit to $254.53 million for the business year ended in March from a previous estimate.
The problem appears to be the Vaio PC unit which is still costing the company a fortune and the disk production unit, which is being kicked to death by online streaming services.
Sony widened its annual net loss estimate to 130 billion yen from the 110 billion it forecast in February, when it reversed a previous profit outlook.
Its rival Panasonic has staged a revival from deep losses by embracing industrial products and selling to businesses rather than consumers. But it has beaten its conservative forecasts while Sony has become known for missing overly optimistic outlooks.
Before Thursday’s cut, Sony had missed its forecasts in 10 of the prior 12 years, excluding gains from asset sales, the worst among 30 Japanese consumer electronics makers, analysts at brokerage firm Jefferies calculated in March.
By comparison, Panasonic, with the best record, exceeded its guidance nine times over the same period.