On Wednesday Japan's third largest electronics company Sony stunned markets when it warned that losses this year would be four times its last forecast. Sony said it expected to post an annual loss of 2.14 billion dollars, blaming a huge charge connected to its mobile phone business.

Despite continuing good sales and growth in its flagship Xperia smartphone line, Sony has cut expectations for the division as it loses ground against rivals such as Apple and Samsung.

Struggle to restructure

Although the company managd to post a profit in 2013, the company is still trying to shake off years of losses, during which its credit rating has been slashed to junk status.

Broad restructuring including massive job cuts has seen it leave the PC business and even sell off its Manhattan headquarters building. Tokyo real estate is also set to come under the hammer.

A reduction in TV division losses has not been enough to start pulling Sony out of the mire. Sony still regards TV production as a core business. It continues to ignore calls to spin off the ailing unit, although it lags far behind competitors Panasonic and Sharp which are both turning a profit.

bew/uhe (AFP)