Looks like it’s time for some of the folks in Sony’s Pictures Unit to start brushing up their CVs.
Sony’s last financial statement was a mess, thanks in no small part to box office flops from the folks in the Entertainment division. Kazuo Hirai has brought in troubleshooters from Bain & Co. to recommend $100 million worth of cuts, which will probably involve job losses. Hirai will host a conference on November 21st, to elaborate on his plans for the division.
There have been calls to sell it off, at least in part, but some analysts acknowledge that entertainment is still a growing market segment for Sony. “Improving the business cannot be all about just cutting costs,” says Mitsushige Akino of Ichiyoshi Asset Management Co.
But something has to change. Sony might be the company behind Breaking Bad, but it also backed After Earth and White House Down, two very expensive duds. Division earnings are down 32% on last year, a decline of approximately $52 million; it’s no surprise Sony’s looking for significant cost cuts. At the very least it needs to change how it picks movie scripts.
Does Sony have a strategy? Only Hirai knows for sure, and he’s saying nothing till the 21st. In the meantime, at least the new console’s doing well; maybe Sony will get that visit from the Profits Santa it was hoping for.
Source: Bloomberg
