PS3 manufacturer preparing revival strategy, says chief executive
Sony has updated its earnings forecast and has now posted a loss of $6.4bn for the year ending in March 2012, according to Reuters. This marks four consecutive years of losses for the tech giant. This is in part due to a struggling TV business, which has lost $10bn in the past 10 years.
Sony chief executive Kazuo Hirai is prepared to take ”painful steps” to make Sony profitable, including scaling back or withdrawing from unsuccessful businesses. A more detailed revival strategy will be revealed at a briefing on Thursday.
Head of fund manager Fukoku Capital Yuuki Sakurai agrees with this strategy. He said, “They could certainly become profitable through downsizing and shrinking some of their loss-making businesses this year, but we’ll have to wait and see if they can continuously be profitable.”
According to Commons Asset Management president Tetsuru Ii, “Hirai needs to develop personnel and platforms that create competitive and innovative products, but a lot of talent left under early retirement plans. The old Sony culture would only allow it to make things that were the best globally. Under that logic, does it make sense to continue its TV business, when it’s not even the market leader in Japan?”
Hirai also plans to integrate Sony’s various entertainment and electronics divisions. This includes merging entertainment properties such as singer/songwriter Kelly Clarkson, and the Spider-Man and Men in Black film franchises with hardware brands such as Vaio and Bravia, in order to boost sales. Similarly, Hirai plans to introduce better content integration between PlayStation and Sony TVs.
Sony forecast it would bounce back in the current year to end-March 2013 with an operating profit of 180 billion yen ($2.2bn).
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