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Sony profits soar more than tenfold, forecast revised up

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Sony president and CEO Kazuo Hirai (L) shakes hands with executive deputy president and CFO, Kenichiro Yoshida (R), during a press briefing at the company’s headquarters in Tokyo on February 2, 2018. Sony chief executive Kazuo Hirai, who led a major and successful overhaul at the Japanese electronics giant, will step down at the end of March, the firm said on February 2 and will become Sony chairman, filling a post that has been empty since June 2012./ AFP PHOTO / Kazuhiro NOGI

Sony said Friday its nine-month profit had soared more than tenfold, and upgraded its annual profit forecast, cementing a roaring recovery for the once-ailing tech titan of Japan Inc.

With its financial health back on track after years of deep losses, Sony said its chief executive Kazuo Hirai would step down after overseeing a successful overhaul.

The electronics giant, which has seen a sharp turnaround thanks to robust sales of PlayStation and smartphone parts, said it logged a nine-month net profit of 507.6 billion yen ($4.62 billion), up from 45.6 billion yen in the same period last year.

It also forecast annual net profit will reach 480 billion yen, up from the previous estimate of 380 billion yen.

The sizzling performance set the stage for Hirai to step aside in March, though he will stay on with the company, becoming its chairman.

He will be replaced by the company’s current chief financial officer Kenichiro Yoshida on April 1, Sony said. Sony’s shares ended the day up 1.85 percent at 5,485 yen after the announcement, compared with a 0.90 percent fall on the benchmark Nikkei 225 index.

The electronics and entertainment giant had struggled with huge losses in recent years.

It has cut thousands of jobs and sold assets, including its Vaio laptop unit and a US headquarters in Manhattan to stop bleeding.

For the past three quarters, Sony saw stronger profits by its game, semiconductor and financial divisions, while a cheaper yen also fuelled better earnings, the company’s statement showed.

The company also benefited from a rebound after deadly quakes in southern Japan hit production in 2016.

Surging sales from its music division have also helped to boost annual expectations, the company added.

“Sony has made a full-fledged comeback. Its game and semiconductors have been major contributors to its profit gain,” Hideki Yasuda, an analyst at Ace Research Institute in Tokyo, told AFP before the financial announcement.

Yasuo Imanaka, an analyst at Rakuten Securities in Tokyo, echoed the sentiment, but added Sony should also work on its movies division.

“Its TV sector is showing a sign of recovery as demand for high-end TV sets is expected to further increase ahead of the Tokyo Olympics. Its immediate job is to rebuild its movie sector,” Imanaka told AFP before the figures were disclosed.


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