clock menu more-arrow no yes

Filed under:

Sony replaces mobile chief and slashes smartphone sales forecast

New, 108 comments

Sony's attempt to become a major player in mobile has hit another speed bump. The company now expects to ship 41 million smartphones in its current fiscal year — that's down from a forecast of 43 million units in July, which was itself a cut from the 50 million projected in April. Although Sony's mobile division brought in ¥308.4 billion ($2.83 billion) in revenue from July to September, around a 1.2 percent increase on a year ago, the company is writing down ¥176 billion yen of the business' value.

Kunimasa Suzuki, the president and CEO of Sony Mobile since April 2012, has been replaced by Hiroki Totoki, until now a senior VP in charge of corporate planning. Suzuki will become executive VP at Sony Entertainment and move to a group executive role at the wider corporation as of November 16th.

Outgoing Sony mobile chief Kunimasa Suzuki

Overall, Sony reported a net loss of ¥136 billion ($1.25 billion) off ¥1.9 trillion ($17.4 billion) revenue in its fiscal Q2, with an operating loss of ¥85.6 billion ($785 million); all of this means the company lost 593.9 percent more money than in Q2 2013. The PlayStation 4 made a strong contribution to Sony's 7.2 percent year-on-year increase in sales with the game division bringing in 83.2 percent more revenue than this time last year, and the weakening yen helped the company's bottom line because most of its sales are outside Japan. Sony puts the swing to operating loss largely down to the mobile division's ¥176 billion impairment charge, which it last month warned investors to expect after a reassessment of the current smartphone strategy.

Sony's camera sensors are its real mobile success

Sony has received some critical acclaim for its smartphones, but has struggled to make inroads in the critical US market. The current flagship Xperia Z3, for example, is only available on fourth-placed T-Mobile and, although number 1 carrier Verizon has recently agreed to sell a model called the Z3v, it's a watered-down version of the Z3 with cheaper hardware design.

While Sony's own phones might not be doing well, the company does have significant presence in the mobile industry in a way most users might not expect: its camera sensors, used by Apple and other leading manufacturers. Sony's "devices" division, which handles component sales, saw revenue increase 23.1 percent and operating profit increase 148.7 percent year-on-year due to an increased demand for image sensors and camera modules in mobile products. It might not be the mobile success Sony is hoping for, but it's nonetheless a bright spot in some otherwise gloomy earnings.