Leaner Sony gains smartphone lift despite its own mobile malaise

Fri Oct 31, 2014 9:13am EDT
 
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By Sophie Knight

TOKYO (Reuters) - Sony Corp (6758.T: Quote) posted a smaller than expected second-quarter operating loss on Friday, hailed by its finance chief as proof that the Japanese group's restructuring program is paying off.

The company said the reduced operating loss was due in part to rising sales of image sensors to smartphone manufacturers, though the poor showing from its own Xperia phones weighed heavily on results.

Sales of the image sensors, used in Apple's (AAPL.O: Quote) iPhones and increasingly in Chinese-made handsets, made the devices unit the biggest earner within Sony's flagship electronics division and offset some of a 176 billion yen ($1.58 billion) impairment charge on its mobile division.

That left an overall operating loss for the three months to Sept. 30 of 85.6 billion yen, beating analyst expectations of nearly double that.

"We are on our way to achieving 400 billion yen in operating profit next year," CFO Kenichiro Yoshida declared at a media briefing on Friday, referring to a target set in May when he announced plans to set aside 135 billion yen to restructure the bloated electronics division.

"Restructuring is progressing well and right now we think we will be able to cut 20 percent of staff at our distribution companies and 30 percent at headquarters."

However, poor sales of the Xperia smartphone have dashed Sony's ambitions of becoming the world's third-biggest smartphone maker behind Apple (AAPL.O: Quote) and Samsung Electronics (005930.KS: Quote).

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Pedestrians are reflected in a logo of Sony Corp outside its showroom in Tokyo July 16, 2014. REUTERS/Yuya Shino