sony ir day 2015 · improvement in product mix with focus on high value-added models ... m4 aqua...

Sony IR Day 2015

Mobile Communications SegmentMay 27, 2015

Hiroki TotokiPresident & CEO, Sony Mobile Communications Inc.

Group Executive, Sony Corporation

Sony IR Day 2015

Agenda

1. FY2014 Review FY2014 Results

2. FY2015 Action Plan Smartphone Market Trends Forecast Management Direction Important Initiatives FY2015 Results Forecast

3. Reference Materials

Mobile Communications Segment

15*FY2014 = Fiscal year ended on March 31, 2015

Sony IR Day 2015


16

1. FY2014 Review

Sony IR Day 2015

FY2014 Results vs FY2013

1

2

3

1,323.31,191.8

Profit decreased due to the goodwill impairment, the unfavorable impact of foreign exchange rates, and an increase in intellectual property related reserves

and restructuring charges, partially offset by an improvement in product mix

12.6

-220.41 2 3

4

4

FY13 FY14(bln yen)


Unfavorable impact of foreign exchange rates*1

Improvement in product mix with focus on high value-added models

Increase in intellectual property related reservesand restructuring charges

176.0 billion yen goodwill impairment charge

Sales

OperatingIncome

*1: Impact of foreign exchange fluctuations is calculated using the sales and costs denominated in each currency in FY2014 and comparing them with the previous fiscal year17

Sony IR Day 2015


18

2. FY2015 Action Plan

Sony IR Day 2015 19

Smartphone Market Trends Forecast (by Price Segment)

Source: Sony MobileCAGR: Compound Annual Growth Rate

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

FY2015FCT

FY2016FCT

FY2017FCT

FY2018FCT

34.436.4 38.0 39.8

CAGR (FY15-18)

5.0%

5.3%

4.1%

9.2%13％

25％

62％

ASP 26,000 yen 25,000 yen* wholesale price

ASP slightly decline in overall market due to slowdown in the high-end and rapid growth in the low-end


Value (trillions of yen)

FY15 FY16 FY17 FY180.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

FY2015 FY2016 FY2017 FY2018

1.34 1.44 1.531.62

CAGR (FY15-18)

8.2%

9.6%

8.2%

6.7%

38％

33％

29％

Units (billions of units)

FY15 FY16 FY17 FY18

Sony IR Day 2015

FY2015 Management Direction Mobile Communications Segment

20

Complete transformation in order to record a profit in FY2016 Focus resources through model count reduction and develop

technology and appealing products for FY2016 and beyond Clarify regional strategy and enhance profit management in

each region Take bold steps to develop new businesses

Sony IR Day 2015

Complete Transformation Mobile Communications Segment

7,100

5,000

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

As of Oct 1, 2014 As of Apr 1, 2016

Operating Expenses Headcount(bln yen) (Headcount)

Approx. 2,100Reduction300

240 210

0

50

100

150

200

250

300

350

FY2014 FY2015 FY2016

Approx. 60 Billion YenReduction

Approx. 30 Billion YenReduction

Delayering: Layers from CEO are reduced from 8 to 6. Simplify and avoid duplications: No. of operating units reduced from 43 to 32.Centralize HQ functions in Tokyo: 20 out of 32 unit heads are based in Tokyo.

(Forecast) (Forecast)

As of Apr. 1, 2016As of Oct. 1, 2014 FY14 FY15 FY16(Forecast)

21

Sony IR Day 2015

Major Xperia Products in 1st half of FY2015

22

M4 Aqua

PremiumSegment

Super MidSegment

TabletSegment

Tablet

・Excellent waterproof: IP65/68 certified ・Battery life lasting up to 2 days ・Sophisticated design

・Design focusing on ultimate quality and functionality

・25mm wide-angle lens ｍain/front camera・LDACTM compatible high quality sound experience

Main Feature

・Worldʼs slimmest and lightest・Latest CPU/OS installed・Excellent waterproof: IP65/68 certified


Sony IR Day 2015

FY2014 FY2016FY2015 FY2016

Examples of Focusing Resources Through Portfolio Size Optimization

Number of VariantsNumber of Platforms

Realize more efficient development by focusing resources on a smaller number of models

R&D Expense

91.0 bln yen

FY2014 FY2016

7 61


23

FY14 FY16 FY15 FY16 FY14 FY16(Forecast) (Forecast) (Forecast) (Forecast)

Approx. 50％reduction



Sony IR Day 2015

Defining Each Regionʼs Position Mobile Communications Segment

Split the 13 sales companies into 5 regions and develop an optimal sales & marketing strategy for each region to enhance investment efficiency and improve profit management

Japan: As the most important region due to its high profitability, aim to maintain profits and expand new business opportunities by leveraging the business platform

Europe: Despite relatively high market share compared to otherregions, profitability is low, so aim to enhance profitability byimproving model mix and strengthening profit management

China: Drastically downsized this business, so continue to operate the business in limited channels with minimized costs

US: Minimize losses by concentrating on limited carriers and focus only on the premium segment

24

Sony IR Day 2015

Internet of Things(IoT) Strategy Mobile Communications Segment

25

Wifi/Ethernet

COMPONENTS/SOC

DEVICES

GATEWAYS

CellularNETWORK SERVICESACESS AND DATA CONNECTION

DEVICES &HW

SERVICES &HW

ACCESS

Leverage Sony competenceCreate HW ecosystem

Utilize accumulated knowhow in

communication technologies, customer management, billing,

CRM etc.

APPLICATIONS

DATA ANALYTICSANALYTICS, STORAGE, BROKER

DEVICE MANAGEMENTSW UPDATES, DM, REMOTE ACCESS

Expand business together with Sony Mobile and So-net

Sony IR Day 2015 26

Challenges for New Business Creation

Launch of Seed Acceleration Program by Sony Mobile

Accelerate the development of smart productswith communication at their core, in the area ofInternet of Things (IoT)

Enter the B2B market through collaboration with So-net Corporation and strengthen efforts to build recurring businesses


Sony IR Day 2015

Sales Trends (FY2014/FY2015) Mobile Communications Segment

(bln yen)

1,410.21,310

FY14 FY15 Apr Forecast

-7%vs FY14

Smartphone Unit Sales Sales Amount

(k units)

Other Smartphones

Others

Z SeriesSmartphones-7%

-32%

+1%

-22%

So-net

39,100

30,000

FY14 FY15 Apr Forecast

OtherSmartphones

-23%

vs FY14

Z SeriesSmartphones

・ The figures for sales include So-net Corporation and its subsidiaries which were previously included in All Other. 27

FY14 FY15 Apr. Forecast

FY14 FY15 Apr. Forecast

Sony IR Day 2015

Changes in FY2015 Operating Income vs FY2014

5

2

3

4

1,3101,410.2

Complete structural reform within FY2015, aiming for a business structure that generates profits without relying on volume. Despite the favorable impact of FY2014

restructuring efforts, operating loss is expected to decrease slightly due to an increase in restructuring charges and the negative impact of FX (excluding the impairment in FY2014).

-217.6

-39

1

FY14 FY15Apr. Forecast

（bln yen）

6

1

-41.6

2 3

4 5 6

Reduction in low- and mid-range smartphoneunit sales

Sales price change

Cost structure improvement throughOPEX reduction

Increase in restructuring charges

176.0 billion yen goodwill impairment charge


Unfavorable impact of foreign exchange rates*1

Sales

OperatingIncome

・ The figures for sales & operating income include So-net Corporation and its subsidiaries which were previously included in All Other.・ The FY2015 forecasts for the segments have been calculated using the assumed foreign currency rates of approx. 118 yen to the U.S. dollar and approx. 136 yen to the euro.*1: Forecasted impact of foreign exchange fluctuations is calculated using the sales and costs denominated in each currency in the FY2015 business plan and comparing them with the previous fiscal year. 28

Sony IR Day 2015


29

3. Reference Materials

Sony IR Day 2015

FY2014 Sales by Key Product / Region

30

Tablet

Accessories and Others Japan

North America

Europe /Middle East

China

Asia-Pacific

Other Areas

Sales13,233Oku yen

Smartphone

Sales by Key Product Groups Sales by Region

Sales13,233Oku yen


Sony IR Day 2015 31

1.9 trillion yen

15.7%0.6%

6.7 trillion yen5.2 trillion yen

8.7%

0.6%

8.8 trillion yen 4.3 trillion yen

4.9% 6.0%

2.3 trillion yen

7.1%

2.0 trillion yen

Japan

Latin AmericaChina

North America

Middle East and Africa

Europe

Asia-Pacific


Inside figure: FY2014 market sizeOutside figure: Sony share

FY2014 Smartphone Market Share in Key Markets (Value basis)

Source: Sony Mobile

sony ir day 2015 · improvement in product mix with focus on high value-added models ... m4 aqua...

Documents