Sony’s Kazuo Hirai to Step Down, Current CFO Taking Over

Kenichiro Yoshida has been named president and CEO of Sony Corporation, which posted a surge in profit in its latest quarterly report, while Kazuo Hirai transitions to the role of chairman.

Yoshida—currently director, representative corporate executive officer, executive deputy president and chief financial officer—has been appointed as director, representative corporate executive officer, president and CEO. Hirai—currently director, representative corporate executive officer, president and CEO—will become director, chairman. The changes take effect April 1.

The news comes as Sony posted strong quarterly earnings, with group revenue up 11 percent to $23.6 billion, while operating profit jumped 280 percent to $3.2 billion. The pictures division, which encompasses film and TV operations, went from an operating loss of $977 million to an operating profit of $96 million. The quarter was boosted by Jumanji: Welcome to the Jungle and increased revenue from TV series licensing, including Netflix’s The Crown. The company revised its outlook for the full-year, expecting operating income to come in at $6.4 billion, which is 346 percent higher than the previous year.

Hirai commented: “Ever since my appointment as president and CEO in April 2012, I have stated that my mission is to ensure Sony continues to be a company that provides customers with kando—to move them emotionally—and inspires and fulfills their curiosity. To this end, I have dedicated myself to transforming the company and enhancing its profitability, and am very proud that now, in the third and final year of our current mid-range corporate plan, we are expecting to exceed our financial targets. And it excites me to hear more and more people enthuse that Sony is back again. As the company approaches a crucial juncture, when we will embark on a new mid-range plan, I consider this to be the ideal time to pass the baton of leadership to new management, for the future of Sony and also for myself to embark on a new chapter in my life. My successor, Kenichiro Yoshida, has supported me closely since returning to Sony in December 2013, contributing extensively beyond his remit as CFO and acting as a valuable confidant and business partner, as we took on the challenge of transforming Sony together. Mr. Yoshida combines a deeply strategic mindset with a relentless determination to achieve defined targets, and the ability to take a global viewpoint. I believe he possesses the breadth of experience and perspective, as well as the unwavering leadership qualities required to manage Sony’s diverse array of businesses, and as such is the ideal person to drive the company forward into the future. As chairman, I will, of course, offer my full support to Mr. Yoshida and the new management team, and do all I can to facilitate a smooth transition and ensure their future success.”

Yoshida commented: “I am very grateful to Kazuo Hirai and the Sony board for their trust and confidence in appointing me as Sony president and CEO, and at the same time feel a great sense of responsibility in taking on this vitally important role. Together with the outstanding talent we have across the Sony Group, I will aim to build on the business foundations established by Mr. Hirai, and execute further reform measures that enhance our competitiveness as a global enterprise, and enable us to realize long-term profit growth. My first priority will be to finalize our next mid-range corporate plan starting in April, together with our immediate business plan for the fiscal year 2018, and then move ahead swiftly with implementation. This is a hugely exciting time at Sony as we look to our future, and together with my management team I intend to determine the best path for us to move forward, and devote my full effort to creating a better Sony that captures the imagination of our many stakeholders around the world.”

Osamu Nagayama, chairman of the board and chair of the nominating committee, said: “The board is grateful to Kazuo Hirai for his outstanding contribution over the past six years, taking leadership of the company amidst an extremely challenging business environment in 2012, and making great progress in revitalizing Sony’s business. Given these achievements, we were initially surprised by his proposal to step down from the role of president and CEO, but over time and following extensive further discussions we ultimately reached a decision to respect his wishes. The nominating committee had been regularly discussing potential management succession plans, and after receiving the proposal from Mr. Hirai, we engaged in renewed discussion, leading to the conclusion that Mr. Yoshida would be the ideal candidate to succeed Mr. Hirai as Sony president and CEO, and lead Sony into the future. The board also unanimously supported this proposal. Together with Mr. Hirai, the board will offer their full support to Mr. Yoshida and his new management team, while also closely observing their progress from a shareholder perspective.”