Original URL: http://www.theregister.co.uk/2001/01/22/ps2_glitches_may_pummel_sony/

PS2 glitches may pummel Sony profits

22 per cent drop is figure being touted

By Lucy Sherriff

Posted in Business, 22nd January 2001 13:23 GMT

Sony looks set to blame poor results at the end of last year on production problems with the PlayStation 2.

According to a survey of analysts by Bloomberg, Sony is expected to have been hit by a 22 per cent reduction in net income in the last quarter of 2000, compared to the same period the year before.

This means profit of ¥72.8 billion ($623 million) down from ¥93.6 billion. Across all its product lines sales are expected to have risen 8.8 per cent to ¥2.1 trillion ($17.97 billion).

The stock-quoting news service quizzed a number of analysts about what the future might hold for Sony.

Kazuharu Mirura, an analyst at Daiwa institute of research said that Sony was likely to miss its annual production targets. "Sony's game operations were not in good shape in the third quarter," he said.

The productions problems have been well documented, but Sony says it has the problem licked, and is confident it will meet its target of ten million PS2s shipped by the end of March. It plans to ramp up its output to two million consoles per month for the next three months.

As well as having sold fewer units, Sony also spent more cash getting the PS2s to the shops - often shipping by plane, rather than by sea. The extra costs from this have been estimated at ¥1500 per console, according to Merrill Lynch analyst Hitoshi Kuriyama. ®

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Find Bloomberg's whole opinion round up here.

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