As for the company’s mobile business, Sony decided to separate the company’s notebook PC revenues from the mobile sector. The company said the decision reflects “the changes the market and business environment have undergone in the past year.” By taking PC revenue out of its mobile business, Sony lowered the sales target for its newly defined mobile sector from, originally, 1.8 trillion yen to 1.5 trillion yen, while maintain its target for operating income margin at 4 percent. While providing no specific sales or margin target for its PC business, Sony simply said it plans to return the PC business to profit in the current fiscal year ending March 2014.
Sony is also lowering the sales target of its imaging business from the originally predicted 1.5 trillion yen to 1.3 trillion yen, most likely reflecting a shrinking market for compact digital still cameras worldwide. Nonetheless, Sony is holding high hopes for its imaging business, hoping to achieve “an operating profit margin of more than 10 percent across the image sensor, professional and consumer categories by the end of the current fiscal year.”
Sony's FY14 targets for sales and income margin
Tweaks and realignments lead Sony to lower targets in some
Parsing Sony’s announcement, a few highlights emerge -- where Sony might be betting big or planning to develop new applications.
Noting that imaging sensors are “a particularly strong category for Sony,” Sony is committed to commercializing “new sensor technologies capable of differentiating finished products,” the company said. Perhaps more important, Sony is also developing technologies “that further expand the range of sensor applications,” according to the company. Such applications include “sensors capable of sensing beyond the visible light spectrum, and sensors capable of detecting and categorizing different types of information,” the Japanese company explained.
As far as the mobile business is concerned, Sony’s emphasis is not just on smartphones but on tablets. Without offering any specifics on new products or new product categories, the company noted that it plans to launch “new and highly competitive products that build on the success of Xperia Z.” Sony intends to roll out the new product (or a new product category) which will “further elevate the mobile ‘Watch,’ ‘Listen,’ and ‘Create’ experiences.”
In its games business, Sony’s is clearly focused on content and services as a stable profit source. Sony also sees streaming PlayStation games as critical. The Japanese company’s plan is to leverage the cloud technologies of Gaikai Inc., acquired last year. With that, Sony hopes to allow users to enjoy the PlayStation experience “across a wide range of products.”
While Sony stressed its focus on the imaging, mobile and game divisions to lift the company’s overall electronics business, its TV business is likely to remain the weak link.
Although Sony says it’s committed to returning the TV business to profitability, the company appears to lack new strategies. In the briefing material, Sony talked about adding a new image processing engine called “X-Reality PRO,” enhancing audio video quality and expanding its 4K LCD TV lineup, while tailoring products that meet the needs of the emerging markets. Nothing, however, jumps out as revolutionary enough to turn around the money-losing TV market.