Corporate Strategy Meeting

Transcription

1 Corporate Strategy Meeting Sony Corporation April 12, 2012

2 Sony will change. Sony Corporation 1

3 Kazuo Hirai, President & CEO Entertainment Electronics Financial Services Sony Corporation 2

4 Electronics Corporate Strategy 1. Current Issues 2. Key Initiatives to Transform Electronics Business 3. Management Structure to Execute Key Initiatives Sony Corporation 3

5 Electronics Corporate Strategy 1. Current Issues 2. Key Initiatives to Transform Electronics Business 3. Management Structure to Execute Key Initiatives Sony Corporation 4

6 Electronics: Issues to be Addressed Business management speed Investment focus/selection based on long-term strategies Innovative products, services and technology TV business loss-making for 8 consecutive years Sony Corporation 5

7 Sony s Strengths Global reach and brand recognition Technology development in digital imaging, game etc. Content & business know-how in film, music & game Sony DNA The will & drive to generate new value Sony Corporation 6

8 Electronics Corporate Strategy 1. Current Issues 2. Key Initiatives to Transform Electronics Business 3. Management Structure to Execute Key Initiatives Sony Corporation 7

9 Key Initiatives Strengthening core businesses Digital Imaging / Game / Mobile Turning around the television business Expanding business in emerging markets Creating new businesses & accelerating innovation Realigning the business portfolio and optimizing resources Sony Corporation 8

10 Key Initiatives Strengthening core businesses Digital Imaging / Game / Mobile Turning around the television business Expanding business in emerging markets Creating new businesses & accelerating innovation Realigning the business portfolio and optimizing resources Sony Corporation 9

11 Electronics: Core Businesses Concentrate investment & technology development in 3 focus areas Digital Imaging / Game / Mobile Within Electronics, 3 focus areas to generate 70% of Sales and 85% of operating income in FY14 (target) Digital Imaging / Game / Mobile Sales Operating Income % of Sales 60% 70% Operating 85% Income FY11 FY14 FY14 % of Sony Corporation 10

12 Core Businesses: 1. Digital Imaging Sales (bln yen) 1,600 1, Sales Operating Income Operating Income (bln yen) Digital Imaging - Consumer Products (Digital still cameras / Digital video cameras / Interchangeable lens digital cameras, etc) - Broadcast and Professional Products (Professional-use cameras, etc.) - Image Sensors (Semiconductors) FY14 Targets Sales: 1.5 trillion yen 0 FY11 FY14 FY11 FY14 0 Operating Income: Target double-digit operating income margin Sony Corporation 11

13 Core Businesses: 1. Digital Imaging Consumer-use (Digital still cameras / Digital video cameras / Interchangeable lens digital cameras, etc) Broadcast and Professional-use (Professional-use cameras, etc.) NEX-7 α77 F65 Signal processing technology Sony-only technology Image sensors Lens Sony Corporation 12

14 Core Businesses: 2. Game Sales (bln yen) 1,200 1,000 Sales Operating Income Operating Income (bln yen) Game - Hardware - Software PlayStation Network etc FY14 Targets Sales: 1 trillion yen Operating Income : 0 FY11 FY14 FY11 FY14 0 Target 8% operating income margin Sony Corporation 13

15 Core Businesses: 2. Game PS3 /PS Vita and peripheral businesses generating steady profit Strengthen & expand network services business PlayStation Network: PlayStation Plus: PlayStation Suite: Grow full-title game downloads Enhance subscription service Increase casual game content & compatible devices Sony Corporation 14

16 Core Businesses: 3. Mobile Sales (bln yen) 1,600 Operating Income (bln yen) Sales 200 Operating Income (loss) Mobile Smartphone / Tablet / PC, etc. 1, FY14 Targets Sales: 1.8 trillion yen Operating Income: Significant improvement 0 0 FY11 FY14 FY11 FY14 FY11 Sales and operating income do not include Sony Mobile Communications However, the dotted lines show sales from Sony Ericsson Mobile Communications as an equity affiliate of Sony Corp. for the purposes of comparison with FY14. Sony Corporation 15

17 Core Businesses: 3. Mobile Sony Convergence Sony-only Technology Digital Imaging & Game Technology & Know-How Entertainment Assets Sony Corporation 16

18 Key Initiatives Strengthening core businesses Digital Imaging / Game / Mobile Turning around the television business Expanding business in emerging markets Creating new businesses & accelerating innovation Realigning the business portfolio and optimizing resources Sony Corporation 17

19 Turning around the television business Target: Profitability in FY13 Solid execution of turnaround plan 1. Fixed business cost reductions 2. Operating cost reductions 3. Enhancing product competitiveness Sony Corporation 18

20 Turning around the television business: Solid execution of turnaround plan Fixed business costs Panel JV-related Other 1. Fixed business cost reduction target: 60% (Reduction from FY11 levels by FY13) - Allows for flexible panel procurement - Target 30% reduction excluding panel JV-related fixed business costs FY11 FY13 Operating costs 2. Operating cost reduction target: 30% (Reduction from FY11 levels by FY13) - Model count reduction - Target 40% reduction vs. FY11 levels by FY12 - Operational improvement FY11 FY13 (supply chain, one-time charges, disposal costs etc.) Sony Corporation 19

21 Turning around television business: Enhancing product competitiveness Differentiation through Sony-unique technologies LCD TV Evolution Next-Gen Display Sony Convergence High resolution & high sound quality OLED Mobile & Connectivity Simplified connection & operation Addressing regional needs Crystal LED Display Outstanding resolution suited for large-sized screens Enhanced network services Sony Corporation 20

22 Key Initiatives Strengthening core businesses Digital Imaging / Game / Mobile Turning around the television business Expanding business in emerging markets Creating new businesses & accelerating innovation Realigning the business portfolio and optimizing resources Sony Corporation 21

23 Expanding business in emerging markets Further expansion in rapidly growing emerging markets Emerging Market Sales Target (Electronics All) FY trn yen FY trn yen Sony Corporation 22

24 Expanding business in emerging markets Further expansion in rapidly growing emerging markets FY09 FY11 FY14 Emerging Market Sales Composition Target (AV / IT businesses) 40% 50% 60% Emerging Market Initiatives Strengthen supply chain & operations Products tailored to local needs TV India Consumer AV / IT No.1 share Sony 30% TV Mexico Consumer AV / IT No.1 share Sony 30% Promote Group-wide assets Joint promotions with Pictures & Music, etc. Home Audio Notebook Sony 60% Sony 15% Home Audio Notebook Sony 35% Sony 15% * FY11 revenue share Sony Corporation 23

25 Growth in Emerging Markets Deploy total Sony Group-wide operational strengths in emerging markets India: Strong consumer product sales & operations 270 stores nationwide (Sony Centers, etc.) No. 1 consumer AV/IT share made possible through stable supply chain management Leading the industry through high-quality content creation Brand enhancement through Entertainment Promoting HD/3D content production through the Media Technology Center in Mumbai Sony Pictures Television operates multiple highlyviewed television channels, including one of the most watched general entertainment channels, and targets a leading industry position. Sony Corporation 24

26 Key Initiatives Strengthening core businesses Digital Imaging / Game / Mobile Turning around the television business Expanding business in emerging markets Creating new businesses & accelerating innovation Realigning the business portfolio and optimizing resources Sony Corporation 25

27 New Businesses: Medical Current Businesses Medical peripherals: FY14 sales target: 50 billion yen Printer Monitor Camera Recorder Medical Equipment B2B Business Grow medical equipment business (endoscopes, etc.) By leveraging image sensor, lens, image processing and other Sony technologies Life Sciences Businesses Enter medical diagnostics business - Acquired icyt, maker of cellular analysis equipment - Acquired Micronics, maker of medical and diagnostics equipment Sony Corporation 26

28 Accelerating Innovation: 4K 4K-related technology 8K-CMOS Image sensor LSI 4K signal processing image compression High-speed optical transmission module 4K ultra high resolution processing LSI SXRD: world s smallest 4K display device CineAlta F65 World s first 4K home theater projector VPL-VW1000ES Digital cinema projector SRX-R320 Expand lineup of professional-use and high-end consumer-use products Sony Corporation 27

29 Key Initiatives Strengthening core businesses Digital Imaging / Game / Mobile Turning around the television business Expanding business in emerging markets Creating new businesses & accelerating innovation Realigning the business portfolio and optimizing resources Sony Corporation 28

30 Realigning the business portfolio Invest in core and new businesses through stringent selection and focus Invest in core and new businesses Realignment in other business areas Core Businesses - Digital Imaging - Game - Mobile New Businesses - Medical Small & mid-sized LCDs - Business spun off into JV Chemical products businesses - Business transfer negotiations E-vehicle batteries & energy storage - Exploring alliances Others Sony Corporation 29

31 Realigning the business portfolio and optimizing resources 1. Modify the business portfolio 2. Restructure headquarters, subsidiaries, sales groups etc. Estimated headcount reductions of approx. 10,000 in FY12 Restructuring charges: 75 billion yen in FY12 Sony Corporation 30

32 Electronics Corporate Strategy 1. Current Issues 2. Key Initiatives to Transform Electronics Business 3. Management Structure to Execute Key Initiatives Sony Corporation 31

33 One Sony Sony Corporation 32

34 One Management Sony Corporation 33

35 New Management Structure CEO CFO CSO Entertainment Electronics Financial Services Sony Corporation 34

36 New Management Structure CEO: K. Hirai CFO : M. Kato CSO : T. Saito Technology: S. Nemoto Product Strategy: K. Suzuki S. Nemoto K. Suzuki Direct to CEO T. Suzuki H. Yoshioka Digital Imaging Professional Solutions VAIO & Mobile Sony Mobile Communications Sony Computer Entertainment Home Entertainment & Sound Sony Network Entertainment Semiconductors Device Solutions Medical Headquarters Global Sales & Marketing Corporate R&D, System and Software Technology, Advanced Device Technology UX / Product Strategy / Creative Manufacturing, Logistics, Procurement and Quality Sony Corporation 35

37 New Management Structure CEO CFO CSO From June 27 Entertainment Financial Services SCA CEO: M. Lynton SFH President: K. Ihara Electronics Sony Pictures Entertainment Sony Music Entertainment Sony/ATV Music Publishing Sony Music Entertainment (Japan) Sony Life Sony Assurance Sony Bank * SCA : Sony Corporation of America, SFH: Sony Financial Holdings Sony Corporation 36

38 Summary Strengthening Core Businesses: Digital Imaging Targets: Sales: 1.5 trillion yen / Operating income margin: Double-digits in FY14 Game Targets: Sales: 1 trillion yen / Operating income margin: 8% in FY14 Mobile Targets: Sales: 1.8 trillion yen / Operating income: Significant improvement in FY14 Turning around the television business: Profitability in FY13, Solid Execution of Turnaround Plan Expanding business in emerging markets: Emerging Markets sales target: 2.6 trillion yen in FY14 Creating new businesses and accelerating innovation: Creating new businesses and accelerating innovation Medical business, 4K, etc. Management Structure: One Sony / One Management Sony Corporation 37

39 FY14 Targets Sony Group Sales: 8.5 trillion yen Operating income margin: >5% ROE: 10% Electronics Sales: 6 trillion yen Operating income margin: 5% Sony Corporation 38

40 Statements made in this presentation with respect to Sony s current plans, estimates, strategies and beliefs and other statements that are not historical facts are forward-looking statements about the future performance of Sony. Forward-looking statements include, but are not limited to, those statements using words such as believe, expect, plans, strategy, prospects, forecast, estimate, project, anticipate, aim, intend, seek, may, might, could or should, and words of similar meaning in connection with a discussion of future operations, financial performance, events or conditions. From time to time, oral or written forward-looking statements may also be included in other materials released to the public. These statements are based on management s assumptions, judgments and beliefs in light of the information currently available to it. Sony cautions you that a number of important risks and uncertainties could cause actual results to differ materially from those discussed in the forward-looking statements, and therefore you should not place undue reliance on them. You also should not rely on any obligation of Sony to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Sony disclaims any such obligation. Risks and uncertainties that might affect Sony include, but are not limited to (i) the global economic environment in which Sony operates and the economic conditions in Sony s markets, particularly levels of consumer spending; (ii) foreign exchange rates, particularly between the yen and the U.S. dollar, the euro and other currencies in which Sony makes significant sales and incurs production costs, or in which Sony s assets and liabilities are denominated; (iii) Sony s ability to continue to design and develop and win acceptance of, as well as achieve sufficient cost reductions for, its products and services, including LCD televisions and game platforms, which are offered in highly competitive markets characterized by continual new product and service introductions, rapid development in technology and subjective and changing consumer preferences; (iv) Sony s ability and timing to recoup large-scale investments required for technology development and production capacity; (v) Sony s ability to implement successful business restructuring and transformation efforts under changing market conditions; (vi) Sony s ability to implement successful hardware, software, and content integration strategies for all segments excluding the Financial Services segment, and to develop and implement successful sales and distribution strategies in light of the Internet and other technological developments; (vii) Sony s continued ability to devote sufficient resources to research and development and, with respect to capital expenditures, to prioritize investments correctly (particularly in the electronics business); (viii) Sony s ability to maintain product quality; (ix) the effectiveness of Sony s strategies and their execution, including but not limited to the success of Sony s acquisitions, joint ventures and other strategic investments (in particular the recent acquisition of Sony Ericsson Mobile Communications AB); (x) Sony s ability to forecast demands, manage timely procurement and control inventories; (xi) the outcome of pending legal and/or regulatory proceedings; (xii) shifts in customer demand for financial services such as life insurance and Sony s ability to conduct successful asset liability management in the Financial Services segment; (xiii) the impact of unfavorable conditions or developments (including market fluctuations or volatility) in the Japanese equity markets on the revenue and operating income of the Financial Services segment; and (xiv) risks related to catastrophic disasters or similar events, including the Great East Japan Earthquake and its aftermath as well as the October 2011 floods in Thailand. Risks and uncertainties also include the impact of any future events with material adverse impact. Sony is currently modifying its business segment classification to reflect its reorganization as of April 1, Sony expects to report its operating results in line with new business segments from the first quarter of the fiscal year ending March 31, 2013.