New Sony CEO promises change after large job cuts

New Sony CEO promises change after large job cuts

TOKYO - Reuters
New Sony CEO promises change after large job cuts

Sony president Hirai (3rd L) and corporate executive officers pose after a meeting. AFP photo

Less than a fortnight into his job as CEO, Kazuo Hirai yesterday sketched out a revival strategy for Sony Corp built around mobile electronics - phones, games and cameras - and a medical business with annual sales of $1.2 billion.

Hirai, who took over from Howard Stringer this month, has doubled Sony’s annual loss forecast to a record $6.4 billion, and is under intense pressure to fix an ailing TV business and turn around a brand that has been trampled by Apple and South Korea’s Samsung Electronics.

Investors call for change

“We have heard a multitude of investor voices calling for change,” Hirai told a packed news conference at Sony’s Tokyo headquarters, close to the company’s first factory established 65 years ago. “Sony will change.”

Sony confirmed earlier media reports that it will cut around 10,000 jobs - 6 percent of its global workforce - and take a 75 billion yen ($926 million) restructuring charge in the current business year to next March. It also plans to cut fixed costs in the TV business by 60 percent in 2013/14 from last year’s levels, and trim 30 percent off the business’ operating costs.

Sony, and other leading Japanese TV makers Sharp Corp and Panasonic Corp have been battered by weak demand, fierce competition and a stronger yen that makes exports less competitive.

The three companies expect a combined loss for the year just ended of $21 billion - more than Sony’s entire market value, which has slumped by close to a fifth in the past month. Samsung is 10 times more valuable, while Apple, which Sony executives considered buying in the early 1990s, is worth 30 Sony’s.

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