[QUOTE="2Chalupas"]
[QUOTE="PraetorianMan"] That's not how business works. It doesn't matter if you lost a trillion dollars yesterday, if you made $20 in profit today and you are expecting to make another $20 tomorrow, that's all people care about. Likewise, it doesn't matter if you made a trillion dollars yesterday. If you lose $20 today, and you don't expect to stop losing money any time soon, investors will flip a **** on you. Economics 101.
phonemug
Ummm. Yeah. That extreme example doesn't work. Not even close. Because you would be paying interest on that $1 trillion lost. At some point you have to pay the piper (the Bankers).
I love me some playstation. But Sony needs to earn more profits, or they won't be able to service their own debt. Economics 101.
I mean there's no imminent danger. But within 5-10 years if they don't start making some years of $Billion+ profits (rather than $ Billions in losses), then Sony as a company is in trouble. Most likely if/when the economy recovers, they will start doing better. But it's a really crowded market in consumer electronics right now, and basically Apple is just killing everyone as far as those electronic gadgets go.
I also disagree with anyone that sugarcoats Nintendo's situation. If the Wii-U is not a hit, they are also in trouble. Actually even worse trouble than Sony, because Nintendo has nothing else to fall back on except gaming. Sony is still a multinational conglomerate with a broader range of products to market and bigger scale. Now right now Sony might actually have TOO MANY products that nothing really stands out. I actually think that's part of the problem. But Nintendo is extreme in the opposite end of the spectrum. Nintendo basically markets 2 products and some games. If they don't work in the marketplace, Nintendo has to scramble to come with something new. Nintendo corporate value could literally drop 50% in a year if the Wii-U is a flop because it's literally set up to be half of their business - Nintendo can't afford a flop in the way that Sony can afford to have a single product flop. If demand for Mario/Zelda dried up in the "mainstream", Nintendo would go the way of SNK or Sega faster than you could blink an eye.
It's great to tout Sony has more to fall back on than Nintendo but when most of what they have to fall back is outright failing that only means they have more burdens sinking them to the bottom of the ocean.They have lost 3.2 billion this year overall, including all of their divisions, and have been losing bucket loads of money for years.
Their networth has gone down from 100 million in 2000 to 16 million in 2012.
They are not going to last much longer at this point.
Yet despite that earthquake year, they have only lost $117 million over the coarse of 5 years. So they obviously had some profitable periods as well. That sucks. But not exactly "boatoads of cash". Not for a company with almost $10 Billion every single year in revenues.
I just looked up their debt, and they actually have more cash on hand than debt (over $1 Billion Cash, only $800 Million debt). For a consumer electronics company that isnt Apple or Microsoft that's not bad. Their yearly revenues are also more than 10x their debt load. So where is the danger of Sony going anywhere imminently? It's not there. Sony would have to completely tank even from what they are today to be in any danger. Now I'm sure in their peak, they probably had many times more cash than debt. Just like Apple and Microsoft do. But if they were in danger, they would have a much worse ratio than that.
Look at a company like AMD.
$606 Million Cash
$2.2 Billion Debt
Infinitely worse cash position than Sony, yet somehow they were able to afford to launch the trinity APU line and still coming with 2nd generation as well as new GPU's. Sony also has alot more revenues than AMD. That's where their "product portfolio" actually pays off, rather than just relying on one product.
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