Apparently, this is not a sweep panorama feature, but a panorama mode where multiple frames are taken in a burst and then stitched together. You may also be sweeping in the wrong direction, accidentally pressing the shutter button too early, or not sweeping far enough (120°).
From the user manual:
To select the angle through which you will pan the camera while shooting, press the selector down. Press the selector left or right to highlight an angle and press MENU/OK.
Press the selector right to view a choice of pan directions. Press the selector left or right to highlight a pan direction and press MENU/OK.
Press the shutter button all the way down to start recording. There is no need to keep the shutter button pressed during recording.
- Pan the camera in the direction shown by the arrow. Shooting ends automatically when the progress bar is full and the panorama is complete.
Shooting ends if the shutter button is pressed all the way down during shooting. No panorama will be recorded if the shutter button is pressed before the camera has panned through 120°.
Panoramas are created from multiple frames. The camera may in some cases record a greater or lesser angle than selected or be unable to stitch the frames together perfectly. The last part of the panorama may not be recorded if shooting ends before the panorama is complete.
Shooting may be interrupted if the camera is panned too quickly or too slowly. Panning the camera in a direction other than that shown cancels shooting.