Early in 2015, Sony CEO Kazuo Hirai announced plans to return the electronics giant to profitability. However, his plans at the time did not include any mention of the smartphone lines of business leading many to conclude the company may exit the smartphone and mobile devices market. Despite producing highly rated smartphones, Sony has struggled to turn a profit on them and has not enjoyed much success in the market, gaining only 1% market share in the U.S. and not much better in other markets. A new statement from Hirai indicates 2016 could be the make or break year for the smartphone division.
Despite the initial absence of smartphones in Hirai’s long-term plans to turn the company around, Sony came back over the summer with a new advertising campaign and a new commitment to the division. Interest in keeping that business afloat seems to be waning quickly. According to Hirai’s statement,
“We will continue with the business as long as we are on track with the scenario of breaking even next year onwards. Otherwise, we haven’t eliminated the consideration of alternative options.”
During July, Sony had to lower its forecast for the smartphone division to a 60 billion yen ($500M USD) loss for the year, down from an earlier 39 billion yen ($325M USD) loss estimate. Even as their mobile communications division continues to struggle, Hirai has led other parts of the company back to profitability. Those successes may have bought Hirai a little time to turnaround smartphones, but the clock definitely seems to be counting down on the division.
What do you think Sony could do to turn things around?
source: Reuters
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