Sony Mulling Sale of Loss-Making Businesses

Sony is reported to be considering a restructuring of its business which could see the loss-making smartphone and TV businesses being sold off.

According to a Reuters report, CEO Kazuo Hirai and his senior management are preparing a new business revival plan and sources close to Sony say that the management recognises that “no business is forever”. Last year the company sold off its Vaio PC business and spun off its TV operations as Sony forecast a net loss for its current fiscal year of ¥230 billion (1.9 billion).

Speaking on the sidelines of last week’s CES, Hirai was quoted as saying: “Electronics in general, along with entertainment and finance, will continue to be an important business. But within that there are some operations that will need to be run with caution – and that might be TV or mobile, for example”.

Sony is also expected to release fewer new smartphones in 2015, in a move mirroring Samsung’s last week to reduce its smartphone line-up because of strong competition from other Asian manufacturers (Samsung to Reduce Smartphone Line-up).

The company will release its third quarter results and latest guidance on 4th February.

Display Daily Comment

The significance of this rumour is that when Hirai took over the management of Sony, he identified “Mobile, Imaging and Gaming” as the key strategic areas for Sony. TV and computing were not mentioned, so the decisions on those businesses were unsurprising. Giving up mobile, however, would be a much bigger decision as it suggests that Sony will then just have Imaging and Gaming. Sony’s imaging and gaming products are excellent, but growth opportunities would be severely limited without mobile. (BR)