Celebrating 10 Years of Trusted News Discovery
One News Page
> > >

Sony splurges on blockbuster share buyback

Video Credit: Reuters Studio - Duration: 02:07s - Published < > Embed
Sony splurges on blockbuster share buyback

Sony splurges on blockbuster share buyback

Technology giant Sony has announced its first-ever buyback of shares worth more than $900 million dollars, but as Reuters Breakingviews' Robyn Mak explains, it's likely just the first step on a journey to higher valuation.

Jayson Albano reports.


Sony splurges on blockbuster share buyback

Technology giant Sony announced its first-ever buyback of shares Friday (February 8) worth more than $900 million dollars.

The move gave Sony's share price a welcome bump and came after the company posted lower-than-expected profits last week from its Playstation division - pushing Sony's share price down to its lowest in more than a year.

The buyback is a move by CEO Kenichiro Yoshida who took the helm last April with an aim to boost shareholder returns.

But as Reuters' Breakingviews columnist Robyn Mak explains, Sony's blockbuster buyback might just be the beginning of a long journey to a stronger share price.

(SOUNDBITE) (English) REUTERS' BREAKINGVIEWS COLUMNIST ROBYN MAK, SAYING: "Sony share buyback, it is a good first step.

But it isn't enough.

In the short-term, the buyback can help lift up the share price of the stock.

It was up 5% already, the day of the news.

But in the long-term if Yoshida wants to unlock value and close the valuation discount, then a wider overhaul of the company is needed.

Besides video games, music and movies, Sony also makes semiconductors and smart phones.

So one step would be to sell off its loss-making smart phone business, which has been a bit of a financial drag on the entire company.

Another would be to spin-off the semi-conductor unit as well." Until a few years ago, Sony struggled with losses in its electronics business to its Asian rivals.

Since then, the company has reinvented itself, gaining revenue from music and gaming.

(SOUNDBITE) (English) REUTERS' BREAKINGVIEWS COLUMNIST ROBYN MAK, SAYING: "Sony's record share-buyback sends a pretty powerful message to investors.

So even though the company's core video games business is slowing, financially speaking, Sony is in better health than it's ever been in recent years.

So operating cash flows has improved a lot.

And it's sitting on four billion dollars of net cash on its balance sheet." The announcement marks Japan's second major buyback this week, after tech giant SoftBank said they would repurchase up to almost $5.5 billion worth of shares.

You Might Like

Environmentally friendly: One News Page is hosted on servers powered solely by renewable energy
© 2019 One News Page Ltd. All Rights Reserved.
About us  |  Contact us  |  Disclaimer  |  Press Room  |  Terms & Conditions  |  Content Accreditation
 RSS  |  News for my Website  |  Free news search widget  |  In the News  |  DMCA / Content Removal  |  Privacy & Data Protection Policy
How are we doing? FeedbackSend us your feedback  |   LIKE us on Facebook   FOLLOW us on Twitter  •  FOLLOW us on Pinterest
One News® is a registered trademark of One News Page Ltd.