New Sony Corp. chief executive Howard Stringer vowed to slash costs, products and personnel while boosting sales by almost $8 billion over the next 2 1/2 years in a plan to revive the company's electronics business.
The added restructuring charges caused Sony to cut its fiscal-year group earnings outlook to a loss of $90 million from the $90 million profit it forecast in July.
The plan, seen as the first big test of Stringer's leadership, also left some questions unanswered, including which product lines Sony will pull out of and how the extra sales will be generated.
The plan is Sony's second blueprint in three years for boosting sales and profit in its electronics business. Poor performance in electronics, which account for about 70 percent of Sony's sales, has pummeled overall group profit as Sony loses market share in areas it used to dominate -- televisions and music players, for example -- to companies such as Samsung Electronics Co. and Apple Computer Inc.
"The world in which this company operates has undergone seismic change," said Stringer, a 63-year-old Welsh-born American who in June became Sony's first foreign chief executive.
Sony will trim 10,000 people from its 151,000 worldwide payroll and cut its manufacturing sites to 54 from 65, Stringer said. The company also will cut its electronics product line. The measures will be completed by March 2008.
Those steps resemble the ones Sony took under its 2003 turnaround plan, which called for 20,000 job cuts. Stringer said his plan eventually will save the company $1.8 billion but require a $1.88 billion hit in restructuring charges. Sony now says it expects to post a loss of $89.9 million this fiscal year, versus a profit of $1.47 billion in the previous fiscal year.