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October 31, 2009

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Sony's quarterly loss smaller

SONY reported a smaller-than-expected 26.3-billion-yen (US$289 million) quarterly loss as cost cuts combined with healthy sales of PlayStation 3 game consoles and Michael Jackson hits helped it inch toward recovery.

The Japanese electronics and entertainment giant has been battered by the global slowdown, sliding prices of gadgets and its failure to produce new blockbuster consumer products. But Sony Corp yesterday said it now expects a smaller flow of red ink for the full fiscal year through March 2010.

It's forecasting a 95-billion-yen loss compared with the initial projection for a 120-billion-yen loss. The new forecast is marginally better than the 98.9-billion-yen loss it suffered the previous fiscal year.

Chief Executive Howard Stringer has promised a turnaround at Sony since taking the helm in 2005, but convincing results have been slow in coming.

Stringer has appointed a new and younger management team he says will better bring together Sony's sprawling empire, including gaming, electronics and entertainment.

A Welsh-born American and the first foreigner to head Sony, Stringer has carried out aggressive cost cuts, shutting plants, reducing suppliers and slashing jobs by the thousands. But the global economic slump and lack of hit products like Apple's iPhone and Nintendo's Wii have hampered recovery efforts.

Tokyo-based Sony, whose global competitors include South Korea's Samsung Electronics Co, said it managed to turn a profit in the July-September quarter at its core electronics and device business. But Sony acknowledged its liquid crystal display TVs and game machine computer chip businesses continued to be hurt by intensifying price competition.

The perk Sony got from nostalgic demand for Jackson albums following his death in June wasn't enough to offset the losses in its other divisions.

Other best-selling albums for the quarter included Whitney Houston's "I Look To You" and the King of Leon's "Only By The Night."



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