×

Sony shares down on $1 billion movie business writedown

Sony Corp. CEO Kazuo Hirai speaks during a press conference on June 29, 2016 in Tokyo, Japan.
Tomohiro Ohsumi | Getty Images
Sony Corp. CEO Kazuo Hirai speaks during a press conference on June 29, 2016 in Tokyo, Japan.

Sony shares plunged as much as 4 percent Monday morning after the company announced it will take a nearly $1 billion charge on its movie business for the fiscal third quarter.

The company took an impairment charge against goodwill of 112.1 billion yen, or $962 million. The charge comes because Sony lowered the expected profitability of its motion pictures business segment, based primarily on how the home entertainment business has performed recently.

Sony Pictures, the company's Hollywood movie business, has struggled to produce hits and compete with movie streaming services.

Sony has lowered its expectations for its home entertainment business — sales of DVDs and Blu-ray discs — as the market for those products shrinks and consumers increasingly favor streaming services like Netflix and Amazon Prime Video.

Sony Entertainment CEOMichael Lynton announced in mid-January that he is stepping down from the role in February and will become chairman of Snap Inc. ahead of its upcoming initial public offering. He will remain with Sony for six months while a replacement is found.