After five years of restructuring by Sony Corp., Chief Executive Officer Kazuo Hirai said Tuesday he is confident the once-dominant electronics giant will see an operating profit of ?500 billion, the largest in two decades, in the current business year.
¡°Achieving such a high goal poses a significant challenge for both managers and employees. But I am confident that, over the past five years, we have established a foundation which enables us to achieve the goal,¡± Hirai said at a news conference at Sony¡¯s headquarters in Tokyo, where he discussed the company¡¯s progress toward its three-year business plan through March 2018.
Sony had set an operating profit target of ?500 billion or more and a return on equity of 10 percent or higher as two goals of the medium-term business plan announced in February 2015.
If achieved, the firm would post its highest operating profit since 1998.
Taking the helm of the troubled company in 2012, Hirai has implemented cost-cutting measures and corporate restructuring ¡ª including the sale of the Vaio personal computer business to an investment fund and splitting Sony¡¯s flagging television manufacturing operations in 2014.
Reviving Sony¡¯s TV division, which recorded an ?800 billion loss over the decade from 2004, had been ¡°the biggest challenge¡± for the company, Hirai said. But thanks to a reduction in production volume and cost-cutting measures, the business has been in the black since 2014.
Gaming has been a major driving force, with brisk sales of the flagship PlayStation 4 gaming console and online gaming subscriptions. Financing and insurance businesses have also underpinned Sony¡¯s profitability.
With the restructuring strategy mostly complete, Hirai said he will continue to focus on markets where demand for the company¡¯s brand is high, particularly in Asia, while scaling back in areas with less demand.
He said one urgent challenge is to revive Sony¡¯s film business, which booked an operating loss of ?80.5 billion in the last business year due to a ?112 billion impairment loss.
¡°I believe Sony is a company that impresses people¡± through electronics, finance and entertainment products, Hirai said, adding it plans to boost development in emerging technologies such as virtual reality, 4K cameras for medical use and image sensors used in next-generation vehicles.
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