Sony: still a Walkman in an iPad age, analysts say
By Hiroshi Hiyama , AFP
May 26, 2014, 12:07 am TWN
TOKYO--Sony's latest bid to halt years of losses and resuscitate its brand has provoked snorts of derision among analysts who say it falls a long way short.
The criticism came after Sony president Kazuo Hirai on Thursday pledged to drag the electronics giant out of a painful restructuring in the current fiscal year and pointed to ultra-high-definition technology as a possible savior for its money-losing TV unit.
Hirai, appointed in 2012 to revive a company mired in losses, has centerd his attention on shaking up a troubled consumer electronics business, including the television unit, which alone has lost about 790 billion yen (US$7.8 billion) over the past decade.
A week ago, Sony shocked investors with a US$1.26 billion annual loss — after several earnings downgrades — and warned it would be in the red again in the year to March 2015.
Sony lost money in five of the last six years and Moody's downgraded its credit rating on the firm to junk in January.
Hirai said the company was aiming for a 400-billion-yen operating profit in the next fiscal year, but that did little to impress analysts.
Sony has long relied on profits it generated from a lesser-known insurance business, as well as movies and music operations to fill some of the yawning deficit in its higher-profile electronics segment.
"Our impression is quite negative. We believe the firm needs to engage in a radical restructuring," said Deutsche Bank analyst Yasuo Nakane.
He added that Thursday's session "revealed absolutely no new information, ideas or strategies such as to change our view on the company."
Hirai's efforts to drag the TV business into the black have so far failed, but he has repeatedly shrugged off pleas to abandon a division that he insists remains central to Sony's core business.
The firm also rejected a call from a U.S. hedge fund billionaire to spin off part of its profitable entertainment arm, which includes a Hollywood studio that produced the latest instalment of "The Amazing Spider-Man" series.
Much of the losses last year stemmed from costs tied to Sony's exit from the personal computer business, part of its wider shakeup which has seen layoffs