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Sony to post larger than expected annual loss

Company cuts earnings forecast for the third time in a year

Sony said on Thursday that it expects to report a net loss of 130 billion yen (£753m / $1.3 billion) for the 12 months ended March 31, 2014.

That compares with a loss of 110 billion yen (£637m / $1.1 billion) forecast in February, itself a reduction from an October 2013 projection of a 30 billion yen (174m / $294m) profit.

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The Japanese company won't report its consolidated results for the fiscal year until May 14, but it published a preliminary earnings report on Thursday.

While Sony has forecast a 14 per cent year on year increase in sales, it will be hit by an expected 30 billion yen (£174m / $294m) of expenses related to exiting the PC business.

The company said on Thursday: "Since Sony's announcement that it will exit the PC business, PC sales for the fiscal year ended March 31, 2014 and expected PC sales for the fiscal year ending March 31, 2015 are underperforming the February expectation.

"Consequently, Sony expects to record write-downs for excess components in inventory and accrual of expenses to compensate suppliers for unused components ordered for Sony's spring PC lineup."

Sony also expects to record 25 billion yen (£145m / $244m) in impairment charges related to its overseas disc manufacturing business, "primarily due to demand for physical media contracting faster than anticipated".

The company said earlier this month that PS4 sales topped seven million units as of April 6.

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