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Sony appoints new CEO, Kazuo Hirai to stay on as chairman

Former PlayStation boss moves aside as current finance chief takes the top job - but what does it mean for Sony's mobile division?

Published onFebruary 2, 2018

Edgar Cervantes / Android Authority

Sony has confirmed that CEO Kazuo Hirai will step down from his role at the end of March following a six-year stint at the head of the Japanese giant. Hirai, who will remain with Sony as chairman, will be replaced by current finance chief Kenichiro Yoshida on April 1st.

In an official statement confirming the changeover, Hirai described his successor as “the ideal person to drive the company forward into the future”, noting the he “possesses the breadth of experience and perspective, as well as the unwavering leadership qualities required to manage Sony’s diverse array of businesses.”

Here's what Sony needs to do to get back in the smartphone game

The announcement coincides with the news that Sony hit an operating profit of 350.8 billion yen (3.2 billion dollars) in its third financial quarter running from October to December 2017. To put that number into perspective, Sony raked in 92.4 billion yen (around $841 million) in the same quarter a year prior.

The former PlayStation boss and Yoshida have both been widely credited as instrumental figures in the Japanese conglomerate’s recent turnaround after a period of heavy financial losses.

Following his appointment in 2012, Hirai implemented a new strategy called the “One Sony” plan which saw the company either completely jettison or cut-back on failing businesses such as its mobile, Vaio PC, and TV divisions. The initiative also placed a renewed focus on gaming and digital imaging technology.

The sweeping changes, and job losses into the thousands, saw the company regain its position as one of the biggest electronics firms in the world. Sony is expected to announce a record operating profit of 720 billion yen (just over 6.5 billion dollars) for 2017.

Putting aside the overwhelming success of the PlayStation brand, the company’s heavy investment in its image sensor business under Hirai’s charge has paid dividends for Sony, which is estimated to control roughly half of the global market.

The situation is far less clear for Sony’s mobile division, however, and it’ll be interesting to see how Yoshida - a man described as Hirai’s “forceful partner” known for “imposing discipline and getting the job done” - will lead the business forward.

Demand for Sony sensors is expected to continue and grow as interest rises in augmented reality and as more OEMs – particularly those in China – double-down on producing smartphones with dual-cameras. PlayStation, meanwhile, has become a seemingly immovable juggernaut in the gaming industry, boasting eye-watering profits thanks to the success of the PS4.

The situation is far less clear for Sony’s mobile division, however, and it’ll be interesting to see how Yoshida – a man described as Hirai’s “forceful partner” known for “imposing discipline and getting the job done” by Reuters – will lead the business forward.

As we noted in our Sony in 2018 preview, the business is barely making a profit despite heavy cutbacks and has a negligible market share presence on a global scale. Hirai reiterated his commitment to developing Sony’s smartphone business mere weeks ago, but the Xperia brand is still lagging behind the market leaders.

Sony’s next big move will come at MWC 2018 where it is expected to launch a new flagship, allegedly dubbed the Xperia XZ Pro, as well as potentially a new Xperia Compact device. I expect Yoshida will be keeping a close eye on the public reaction and resulting sales figures.

As for Hirai, the 57-year-old is likely to assume a far more passive role at Sony as chairman – a position the industry veteran has undoubtedly earned. Speaking of his recent achievements, Hirai said:

Ever since my appointment as President and CEO in April 2012, I have stated that my mission is to ensure Sony continues to be a company that provides customers with kando – to move them emotionally – and inspires and fulfills their curiosity. To this end, I have dedicated myself to transforming the company and enhancing its profitability, and am very proud that now, in the third and final year of our current mid-range corporate plan, we are expecting to exceed our financial targets. And it excites me to hear more and more people enthuse that Sony is back again.

Is this the right time for a change of leadership at Sony? Let us know your thoughts in the comments.

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