Looks like the credit crunch is biting into home-electronics spending. Sony (NYSE: SNE) is knocking a big 38 percent off its expected 2008/09 net income, down to 150 billion yen ($1.54 billion)—thanks to slowing sales of gadgets and currency market fluctuations.

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Sony expects operating income to be 57 percent lower than its July forecast of 200 billion yen ($2.06 billion), because the yen is stronger now than it was at the time. Most of the hit will be taken in the electronics and games segments, which makes up over two thirds of the drop: “We expect the results of certain businesses in the electronics segment, such as the LCD television, compact digital camera and video camera businesses, to be lower than the previous forecast due to a deterioration in the market environment brought on by the slowing global economy and an intensification of price competition.”

No wonder the outlook’s been scaled back: Reporting Q2 earnings on Thursday, Sony said operating income for the three months to Sept. 30 was a tenth that in the same period last year, at 11 billion yen ($113 million), with net income down 72 percent, to 21 billion yen ($216.5 million).