Sony Promises Overhaul in Smartphone Unit

On Tuesday, Sony Corp pledged an overhaul of its smartphone unit that is losing money during the next year.

Hiroki Totoki, the new head of the mobile unit at Sony acknowledged that Sony’s previous goal of one day being the third largest global smartphone brand, behind only Samsung and Apple was overly optimistic.

At this point, the focus is on returning profitability to the unit, said Totoki, even if there is a drastic reduction in sales, with the goal of just maintaining a hand in the business, given its great importance to developing future technologies directed toward the consumer, added Totoki.

Totoki said the urgent task at hand was to make the mobile business profitable even if the company sees sales declines of up to 30%. He took over the division earlier in November from Kunimasa Suzuki.

Restructuring the unit, which the company just a short time ago saw as its possible driver for growth, has become a big priority for the company as it tries again to turn its troubled electronics segment around.

Sony has offered signs repeatedly of its turnaround in electronics, only to dash all hope with another downturn.

Under CEO Kazuo Hirai, and Kenichiro Yoshida the new CFO, Sony has been accelerating its restructuring of its electronics division.

Its goal is to rebuild around its image sensor and videogame division, as well as with its entertainment division, which includes studio operations in Hollywood and its music segment.

Sony solid its personal computer business, has spun off its TV unit and cut costs in other areas.

Sony has generated strong growth in its division of videogames and its devices arm, which makes smartphone image sensors.

The company on Tuesday said that sales for its videogame segment, which includes its PlayStation consoles as well as network services, would increase to $12 billion during the current fiscal year that ends March 2016.

Sony did not disclose its forecast for fiscal midterm for its smartphone business. Previously it cut its forecast for the short term and wrote down the unit’s value, which had not been able to compete with Apple or Samsung at the market’s high end and which has been hard hit in regions such as China, by the increase in inexpensive smartphones from Xiaomi and other competitors.

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