Battery Recall Hurts Sony On Multiple Fronts
Oct 27, 2006, 5:01 AM
The global laptop maker recall of Sony lithium-ion batteries has tarnished both Sony's brand image and its bottom line. The Japanese electronics and entertainment company said Thursday that the recall and red ink in its video-game business contributed to a 94 percent drop in net profit for the 3rd quarter, to $14 million. The recall, which cost Sony $429 million, offset an 8 percent increase in overall sales from July-September, to $15.6 billion. The company also reported a $366 million operating loss in its gaming division because of charges related to preparation for the next-generation PlayStation 3 console, set to go on sale in the U.S. and Japan next month.