Originally aiming for a profit of $2.2 billion (200 billion Yen), and subsequently lowering its expectations to a loss of $1.1 billion, Sony has again readjusted its forecast to predict net loss of $2.9 billion (260 billion Yen) this year.
This loss is Sony's first in 14 years and the second in the company's history.
Sony blamed the results on strong yen and declining demand for its products in the current global economic environment; but the truth is that Sony has fallen behind Apple's iPod in portable music, Nintendo in videogames, and is losing money on flat TVs.
"Sony needs further restructuring, not just cost-cutting but a revamping of its business operations," said Naoki Fujiwara, a fund manager at Shinkin Asset Management.
Sony said it would respond by accelerating restructuring, more than doubling a cost-cutting target for the year to March 2010 to 250 billion yen ($2.8 billion).
Sony expects that its gaming division will lose up to $338 million, attributed to lower than expected sales.