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Sony games division losses increase

By Reuters
Tokyo, 28 Jul 2006

Sony's losses at its games division in the July-September quarter may be bigger than its losses for the quarter ended in June due to a possible increase in valuation losses on PlayStation 3 (PS3) microchips.

The comments were made by Sony senior VP Takao Yuhara to a group of reporters.

Sony's games division posted an operating loss of 26.8 billion yen ($231.5 million) for the first quarter of the financial year. Sony also said it aims to recover PS3-related investment in just less than five years as it did with the previous generation game console PlayStation 2.

Yuhara's comments come one day after Sony announced it swung to a better-than-expected operating profit of 27.05 billion yen in April-June, propelled by robust sales of its Bravia brand LCD televisions and Cybershot digital cameras.

The quarterly result sparked a rally in Sony shares on Friday. They were trading up 4.58%, at 5 250, yen in early afternoon trade.

Sony plans to launch PlayStation 3 on 11 November in Japan and on 17 November in most of the rest of the world.

It aims to ship six million units of the PlayStation 3 by March.

Sony plans to sell the basic model, which comes with a 20GB hard disk drive and Blu-Ray high-definition optical disc player, for $499 in the US, while Nintendo's Wii will be priced at or below $250 and Microsoft's Xbox 360 now sells for $399.

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