Sony Stock Takes Hit on Tokyo Exchange on Security Worries

It should come as no great surprise that Sony shares have taken a beating since the massive security breaches a few weeks ago. The prolonged downtime of the PlayStation Network is also weighing heavily on investor confidence. Sony shares dropped 3.7 percent on Friday following this week’s announcement that Sony Online Entertainment has been hacked and the ongoing struggle to get PSN back online.

Tokyo’s financial markets were closed for national holidays Tuesday to Thursday, but reacted negatively to news on Friday morning, according to a Reuters report.

Analysts are also voicing concern about Sony’s current situation, and with rumors of a third attack this weekend it is a recipe for more declines in its stock price.

Citigroup Global Markets Japan analyst Kota Ezawa said in a research note that "there is a real concern that trust in Sony’s business will decline. The network business itself still only makes a small direct contribution to earnings, but we see a potential drop in hardware sales as a concern."

Sony president Howard Stringer issued an open letter to the public apologizing for all the problems and promising to have better security going forward. Sony also announced a free 12 month indentify theft protection program for PSN users when the service relaunches.

Source: C&VG

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