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Technology conglomerate Sony will lay off 1,000 more employees in its mobile division later this year as it attempts to make the struggling business profitable, a new report says.
The company had previously announced plans to cut 1,000 jobs in the mobile division, so this latest cut would bring the layoff total to 2,000, according to a Reuters report citing people who claim to have knowledge of Sony’s plans. The cuts would bring the total number of employees in the division to 5,000 by March 2016, the report said.
Sony’s Mobile Communications business produces the company’s smartphones, tablets, and other mobile products. The division has been called by CEO Kazuo Hirai one of its most important as he attempts to revive the ailing conglomerate and bring it back to its former glory.
In 2012, Hirai unveiled his , which focuses the company on three core pillars — gaming, digital imaging, and mobile. While the gaming division has been performing well on the back of the PlayStation 4 and Sony has been able to grow its imaging business, the mobile division has proven to be a sore spot.
During its last-reported quarter ended September 30, Sony announced that its mobile division generated sales of $2.8 billion, falling 4 percent when fluctuations in currency between the Japanese yen and US dollar are not factored in. More concerning, the division posted a $1.6 billion operating loss as expenses rose and consumers turned elsewhere for their mobile products.
Consumers going elsewhere for Sony’s devices may be a trend it won’t overcome anytime soon. Last week, research firm TrendForce reported that Sony was only able to capture 3.9 percent of the worldwide smartphone market, putting it in eighth place behind the likes of Samsung, Apple, Xiaomi, and Coolpad, among others. In 2013, Sony had 4.1 percent share and was in sixth place. By the end of 2015, Sony’s market share is expected to slip to 3.1 percent and land the company in tenth place, TrendForce estimates.
The Reuters report followed a similar claim made by Japan-based news outlet Nikkei on Wednesday. That report, citing unidentified sources, said that Sony’s cuts will come mainly from Europe and China.
Sony is expected to make the layoff announcement in early February during its next earnings release.
Sony did not immediately respond to a request for comment.
