Sony recently announced its corporate strategy for three years which will see it focus on its PlayStation and entertainment business and return the company to profitability after a series of losses.
Outlining his strategy for the loss-making Japanese consumer electronics icon to 2018, CEO Kazuo Hirai said Sony wanted to give its subsidiaries more autonomy in decision making to help drive growth.
“If our initial mid-term corporate strategy was about reforms, the second mid-term strategy starting from the next business year will be about generating profit and investing for growth,” Kazuo said in the strategy briefing.
The company has reported six net losses over the last seven years, but it said that this new three-year strategy is aimed at delivering a 500 billion yen ($4.2 billion) consolidated operating profit for its fiscal 2017. Sony recorded a $1.2 billion loss for its last full year of business (fiscal 2013) last March, and it is expected to post another loss — albeit a slimmer one — for FY 2014.
The company will split its businesses into three categories: ‘Growth driver,’ ‘stable profit generator’ and ‘area focusing on volatility management.’
Sony’s Game & Network Services business, which features PlayStation, will be categorised as a ‘growth driver.’ Sony now intends to expand the userbase of its console platform and PlayStation Network as part of this plan. Comparatively, its TV and Mobile Communications division will fall into the ‘volatility management’ category.
“Sony will place the highest priority on curtailing risk and securing profits in its operation of these businesses,” it said in a note issued today.
Sony’s strategy revamp comes as cut-throat competition squeezes some of its Japanese peers into losses and restructurings.