Sony has a tale of woe and suffering as it has announced a 68% drop in operating profits, and all thanks to the PS3 launch.

In the year ending March 31 operating profits dived to 71.8 billion Yen (EUR 438.3 million), down from 226.42 billion Yen (EUR 1.38 billion) for the previous year.

"In the Game segment, there was a significant operating loss as a result of the sale of PS3 at strategic price points lower than its production cost during the introductory period", quoted Sony’s annual report.

The biggest quarterly loss was in the period of January to March 2007, when Europe saw the PS3 launch, with the Game division leading the way due to selling the PS3 lower than the manufacturing price.

A drop in PS2 game sales also impacted the company’s performance.

Despite everything the company has been buoyant and looking forward to a better future.

"A significant reduction in operating loss is expected due to rapid reductions in hardware production costs and an enhanced line-up of software titles in the PS3 business", Sony reported.