Sony Corp targets to increase operating profits 25-fold within three years piggybacking on its camera sensors and PlayStation units, declared its chief executive in crafting a strategy that could see the company exiting from their traditional forte of TV and smartphone sectors.
CEO Kazuo Hirai said on Wednesday that Sony is not interested to pursue sales growth in the smartphone sector, where the company has suffered intense competition from their Asian rivals as well as the market leaders of Apple Inc and Samsung Electronics.
Sony instead would concentrate on more lucrative areas, such as, camera sensors, video games and entertainment. This is to reprimand the company’s need to returning in the growth mode after sixth net loss in seven previous years.
The comments helped Sony raise its share price by 1.4 percent in the fag end of the day in New York.
In a report from Reuters, Hirai extended support to provide greater autonomy to the Sony units in making their own business decisions, as he intoned, “The strategy starting from the next business year will be about generating profit and investing for growth.”
He further hinted at a way out from TV and mobile phone units. He said, he is not “ruling out considering an exit strategy.” This is Sony’s clearest hints so far regarding their possible exit for these loss making units.
Sony is in the middle of a restructuring process of a possible wind down of its struggling units and lay off thousands of jobs.
The investors have applauded its restructuring strategy leading to its share price rising 80 percent over the past year. This change is brought about by Hirai, since he assumed the chief executive’s office in late 2013.
Sony’s overhaul has started to reap benefits. This month, a profit is forecasted against an overall loss for the financial year ending March 31. The company is expected to register a net loss in 2014-15, although at a smaller magnitude compared to what was previously estimated.
There is little hope for Sony returning to the glory days of redefining consumer entertainment with its Walkman and Trinitron TV. The business analysts are of the opinion that Sony can better leverage with its gadget business and access to Hollywood content.