Is It Time For Sony To Stop Making Phones After Dismal Mobile Results?


Poor performance from mobile division brings down FY2014 results, but Sony expects profits to quadruple

Questions have been raised over Sony’s future in the smartphone market after its mobile division hugely underperformed last year.

Despite several well-received mobile devices, most notably the Xperia Z3 smartphone and Xperia Z4 tablet, Sony’s Mobile Division made an operating loss of 217.6 billion yen (£1.18bn) during the financial year 2014.

This was not helped by a 176 billion yen (£957m) impairment charge from the smartphone and tablet business, and restructuring costs from the sale of the VAIO PC unit last February, but the company says that mobile is still the only core division that Sony is expecting to lose money, forecasting a 7.1 percent slip in revenue and an operating loss of 39 billion yen (£212m).

Sony Xperia Z4 tabletTime to focus?

The company also revealed that it spent $41m (£26.5m) in “investigation and remediation expenses” concerning the massive cyber-attacks it suffered last year, as hackers targeted its film and gaming divisions.

That hack last November came as Sony Pictures prepared to release “The Interview”, a comedy about a fictional plot to assassinate North Korean leader Kim Jong Un.

The hack penetrated Sony Pictures’ internal network and led to the leak of unreleased films, as well as the publication of embarrassing internal documents, including the salary details of top executives and personal information on Hollywood celebrities.

However it’s not all doom and gloom for Sony, as the company revealed that it expects operating profit to more than quadruple this year.

It is forecasting operating income of 320bn yen (£1.7bn) for the year ending in March 2016, although this was still below analyst estimates.

This growth will be fuelled by strong sales of camera sensors, which are used in Apple’s iPhone devices, and cost cuts across a number of divisions as Sony targets more lucrative, growing markets.

What do you remember about the smartphones of 2014? Try our quiz!