Sony Announces Plans To Catapult Company Out Of 4-Year Losing Streak

Sony today unveiled in a news release today, plans to revive the company from a four year storm of losses, and as the company’s CEO Kazuo Hirai said in a recent news conference, “Sony will change.”

The company introduced its new management team on April 1st, 2012. The team has put forward key initiatives to move the business forward. Sony’s plans are to: expand their business into emerging markets, strengthen their core business (Digital Imaging, Gaming, Mobile), change focus with their television business, and center themselves more on innovation. However the most striking move is its plan to slash 6% of its workforce overall, roughly 10,000 workers.

The management team’s target goals for March, 31, 2015 are to have sales of 6 trillion yen and an operating income margin of 5% in their electronics business; and for the overall company they plan on sales of 8.5 trillion yen, an operating income margin of 5% and a return on equity (ROE) of 10% .

Sony–whose name once synonymous with innovation with its Walkman of years past–has lost it’s edge in the face of American supercompany Apple and South Korean giant Samsung. This has lead Sony to lose focus on its innovation as now it’s scope is too broad, making everything from sound equipment to obscure gadgets.

Smartphones will be more of the company’s focus, as Sony expects to reach sales of 1.8 trillion yen, almost tripling its sales within three years. With gaming, the company expects growth with it’s new Vita mobile gaming device and also with its Playstation Network. The television aspect of the business has consistently lost money for the last eight years. Although Mr. Hirai says that they will not be removing their television producing completely, but there will nonetheless be a 60% reduction in the branch’s fixed costs. The company hope to bank on their new, OLED and Crystal LED high-tech displays.

Sony’s future is uncertain, but newly appointed (April 1) CEO Kazuo Hirai has declared, “the time for Sony to change is now.”

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