Sony Shares Down 4.77% on Restructuring Plan
Sony shares fell nearly 5.0 percent in morning trade Friday after the struggling Japanese firm's new chief outlined an "urgent" strategy to turn it around, including slashing 10,000 jobs.
The firm slumped 4.77 percent to 1,455 yen by the break as the broader market soared on news that a North Korean rocket launch, which had sent jitters across the region, failed.
Sony on Thursday announced the huge job losses and said it would spend nearly $1.0 billion on restructuring to staunch multi-billion dollar losses, which will see it post its fourth consecutive annual loss.
Kazuo Hirai said he would aim to make the Sony's struggling television unit profitable within two years by slashing costs and boosting the image of its Bravia television brand, a business he described as part of Sony's make-up.
In addition to the job cuts, which account for about 6.0 percent of Sony's total workforce, the reforms include expanding its PlayStation and online games business, pushing further into emerging markets and eyeing new markets, such as the medical equipment sector.
But investors were unimpressed, sending Sony shares tumbling.
"(Hirai) looked very motivated, but there was nothing surprising announced in turning business around," said an operating officer at a Japanese brokerage.
Sony warned earlier this week it would post a record full-year loss of 520 billion yen ($6.4 billion), more than five times its 90 billion yen loss prediction late last year.
Japan's electronics giants, including Sharp and Panasonic, have suffered in recent years, particularly in their television business, as stiff competition has sent prices tumbling, while the effects of the strong yen and a stuttering global economy have also hit sales.
Source: Agence France Presse
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