The Gulf Time Newspaper One of the finest business newspapers in the UAE brought to you by our professional writers and editors.
Bloomberg
Sony Corp. is buying back as much as 100 billion yen ($910 million) of its own shares, the electronics maker’s first-ever large scale repurchase.
The shares rose as much as 4.8 percent in early trading in Tokyo after announcing the buyback, which will start on Tuesday and last through March 22. This is the first share repurchase aimed at enhancing shareholder value, and is also the biggest ever, the company said.
Sony last bought its own shares in 2004, 6.3 billion yen worth, related to its decision to fully merge PlayStation subsidiary Sony Computer Entertainment into the parent company.
The latest repurchase would make up about 2.4 percent of the stock, and comes days after Japanese telecoms and technology giant SoftBank Group Corp. announced a 600 billion yen share buyback, it’s biggest-ever.
Sony has been seeking to strength its financial footing under Chief Executive Officer Kenichiro Yoshida, who was promoted from chief financial officer last year. Sony this week reported weaker profits in the PlayStation business and cut its annual revenue forecast, triggering the steepest share decline in almost three and a half years.
“The buyback itself was a surprise,†said Hideki Yasuda, analyst at Ace Research Institute. “Management probably thinks Sony’s share price is undervalued.â€
Sony’s results underscore the struggle at big technology companies, which are seeing slowing demand for their products and services. Apple Inc. reported a decline in revenue for the first time in two years, while chipmakers Intel Corp. and Nvidia Corp. have warned of weaker sales as China’s economy starts to sputter and looming uncertainly over Brexit.