At first it was largely known for its unique Walkmans and it has rapidly grown to a tech giant. Nevertheless, the recent years Sony is suffering from losses in sales. The combination of these losses and the growing popularity of image sensors has lead the Japanese firm to a profound move.
Sony’s cell phone department has been facing a difficult time recently. However the business’s visual sensors continue to be really prominent in the smart-phone and wider digital marketplace.
In a bid to bet to its benefits, Sony is trying to invest intensively in additional manufacturing capacity for cell phone visual sensors.
In an attempt to increase the required money for this pricey investment, Sony will be providing brand new shares something that has never happened since 1989.
In 1989, this action of the company has that triggered an 8.25 percent fall in its share worth. However, the situation is pretty different now and the firm is very optimistic about the results of this method.
The company is hoping to raise about $3.6 billion, using a combination of selling fresh shares and modifiable bonds.
The current production capacity of the company is preventing the maximization of its revenue even if the demand for cutting edge camera modules has been increased.
Because of that, Sony intends to invest a great amount of the extra revenue to boost its manufacturing capacity for Smart-Phone visual sensors like the ones that other big names like Samsung and Apple use in their products.
Exactly from the company’s mouth: “Sony Corporation plans to apply the funds raised by this issuance of new shares to expenditures for increasing the production capacity of, and research and development for, stacked CMOS image sensors in the Devices segment in order to further enhance profitability”.
In fact, the company’s financial officer Yoshida Kenichiro has said that the firm is planning to invest ¥80 billion on digital modules as well as ¥210 billion in image sensors. It’s also expected that Sony will quadruple its operating profit in 2016, after carrying out a company-wide restructuring plan and solid sales of digital sensors.
This is a part of a bigger project for Sony which wants to center its attention to its strongest products like device components, gaming and music. However based on the fact the Sony’s mobile hardware business is struggling it’s not clear what this means.
Even though, the company’s choice to invest in production and development makes sense if you consider that Sony’s mobile and TV Business has been suffering from monetary losses for several years.
Now that Sony’s sensors are selling amazingly well the company wants to take advantage of the successful and profitable line of products that has in its hands. The sensors of the Japanese giant are selling so well that Sony will get a fair part of the visual sensor marketplace.
Additionally, in an attempt to promote brand awareness among customers, Sony is planning to maintain its presence in the TV marketplace, despite the losses in revenue.
Sony stated that the goal of the current fundraising round is to empower the firm’s financial base in order not only to increase production but to generate massive growth until 2017.