Brands
FY-2015: Forex, PS4, image sensors boost Sony revenue 5.8%
BENGALURU: Sony Corporation reported a 5.8 per cent growth in sales and operating revenue in FY-2015 (year ended 31 March, 2015, current year) at ?8215.9 billion as compared to the ?7767.5 billion in FY-2014. The company says that the increase was primarily due to the impact of foreign exchange rates, a significant increase in Game & Network Services (G&NS) segment sales reflecting the strong performance of PlayStation 4 (PS4) and a significant increase in Devices segment sales due to the strong performance of image sensors. This increase was partially offset by a significant decrease in sales in All Other, primarily related to Sony’s exit from the PC business. On a constant currency basis, sales were essentially flat year-on-year says the company.
The company’s operating income more than doubled (up 2.6 times) to ?68.5 billion in the current year from ?26.5 billion in the previous year. Sony says that the increase was primarily due to a significant improvement in the operating results of the Devices, G&NS and Home Entertainment & Sound (HE&S) segments. This improvement was partially offset by a significant deterioration in operating results in the Mobile Communications (MC) segment, primarily due to a ?176.0 billion ($1,467 million) impairment of goodwill.
The net loss attributable to Sony’s stockholders in the year at ?126 billion in FY-2015 was slightly lower than the loss of ?128.4 billion in FY-2014.
Business Segments
Mobile Communications (MC)
Sony’s MC segment reported 11 per cent improvement in sales and operating revenues in FY-2015 to ?1323.3 billion as compared to the ?1191.8 billion in FY-2014. The segment reported an operating loss of ?220.4 billion in the current year as compared to an operating profit of ?12.6 billion last year. As mentioned above, the major contributor to loss was the impairment of goodwill of ?176.0 billion.
Game & Network Services (G&NS)
G&NS segment reported 33 per cent growth in sales and operating income to ?1388 billion in FY-2015 as compared to the ?1043.9 billion in FY-2014. Sales and operating income increase was primarily due to an increase in PS4 hardware unit sales, an increase in network services revenue, the impact of foreign exchange rates and an increase in PS4 software sales, partially offset by a decrease in PlayStation3 (PS3) hardware and PS3 software sales.
The segment’s operating profit improved to ?48.1 billion in the current year as compared to a loss of ?18.8 billion in the previous year.
Imaging Products & Solutions (IP&S)
IP&S reported 2.9 per cent drop in sales and operating revenue to ?720 billion in the current year from ?741.2 billion in the previous year primarily due to a significant decrease in unit sales of digital cameras and video cameras reflecting a contraction of these markets, partially offset by the impact of foreign exchange rates and an improvement in the product mix of digital cameras reflecting a shift to high value-added models.
Operating income more than doubled (2.08 times) in FY-2015 to ?54.7 billion as compared to the ?26.2 billion in FY-2014. This increase was mainly due to a reduction in selling, general and administrative expenses, the favourable impact of foreign exchange rates and the above-mentioned improvement in product mix reflecting a shift to high value-added models, partially offset by the above-mentioned decrease in sales of digital cameras and video says Sony.
Home Entertainment & Sound (HE&S)
HE&S revenue in FY-2015 improved 3.3 per cent to ?1207.3 billion from ?1168.6 billion in the previous year due to the impact of foreign exchange rates and an increase in sales of televisions, partially offset by a decrease in audio and video sales. Unit sales of LCD televisions increased mainly due to increases in North America, Japan and Europe, partially offset by decreases in Latin America and China. In Television, sales increased 10.7 per cent year-on-year to ?835.1 billion in FY-2015.
The segment reported operating profit of ?20.1 billion as compared to a loss of ?25.5 in the previous year due to cost reductions and an improvement in product mix reflecting a shift to high value-added models, partially offset by the unfavourable impact of the appreciation of the U.S. dollar, reflecting the high ratio of US dollar-denominated costs.
Devices
Revenue improved 23.9 per cent in FY-2015 to ?957.8billion from ?773 billion in FY-2014 due to increase in sales of image sensors reflecting higher demand for mobile products, the impact of foreign exchange rates, as well as a significant increase in sales of camera modules. Sales to external customers increased 29.8 per cent year-on-year.
The segment reported operating profit of ?93.1 billion in the current year as compared to a loss of ?12.4 billion in FY-2014 due to the impact of the above-mentioned increase in sales of image sensors, the recording of a 32.1 billion yen impairment charge related to long-lived assets in the battery business in the previous fiscal year and the favourable impact of foreign exchange rates.
Pictures
Sony’s Pictures segment report 5.9 per cent rise in FY-2015 in revenue to ?878.7 billion from ?829.6 billion in FY-2014. However in dollar terms, sales from the segment reduced 4 per cent to $7322 million due to a decrease in sales for Motion Pictures and Television Productions. The decrease in Motion Pictures sales was primarily due to lower theatrical revenues reflecting fewer theatrical releases as compared to the previous fiscal year. The decrease in Television Productions sales was due to the previous fiscal year benefitting from the extension and expansion in scope of a licensing agreement for game shows produced by SPE, including Wheel of Fortune. Sales for Media Networks increased year-on-year due to higher digital game revenues and advertising revenues primarily due to acquisitions made in the previous and current fiscal year.
Pictures segment operating income improved 13.4 per cent to ?58.5 billion in FY-2015 from ?51.6 billion in the previous year due to the favourable impact of the depreciation of the yen against the U.S. dollar. On a US dollar basis, operating income was essentially flat year-on-year. The current fiscal year benefitted from the stronger performance of the current fiscal year’s film slate as the previous fiscal year reflected the underperformance of White House Down and After Earth. The current fiscal year also benefitted from lower restructuring charges. Partially offsetting this increase was a gain recognized on the sale of SPE’s music publishing catalogue in the previous fiscal year, the above mentioned decrease in Television Productions sales and higher programming and marketing costs for SPE’s television networks in India.
Music
Sony’s Music segment reported an improvement of 8.2 per cent in revenue in FY-2105 to ?544.6 billion from ?503.3 in the previous year due to depreciation of the yen against the US dollar.
Operating Income in FY-2015 improved 17.4 per cent to ?59 billion form ?50.2 billion in FY-2014.
Financial Services
Financial Services revenue in FY-2015 increased nine per cent to ?1083.6 billion from ?993.8 billion in FY-2014. Operating income from the segment improved 13.5 per cent in the current year to ?193.3 billion from ?170.3 billion in the previous year.
Cyber attack impact on Sony’s FY-2015 figures
Sony’s FY-2015 numbers also included approximately $41 million (?4.9 billion) in costs primarily related to investigation and remediation expenses relating to a cyber attack on SPE’s network and IT infrastructure, which was identified in November 2014 (the cyber attack).
Brands
Tessolve lands a semiconductor veteran to drive its next big push
Ravi Kumar Chirugudu, who started his career at ISRO and has spent 35 years building chips and companies, joins the Bengaluru-based firm as president and chief operating officer
BENGALURU: Tessolve has never been shy about its ambitions. The Bengaluru-based engineering services firm already counts 18 of the world’s top 20 semiconductor companies among its clients, employs more than 3,500 engineers across 12 countries, and last year pocketed a $150m investment from TPG. Now it has hired the executive it believes can turn those assets into something bigger. Ravi Kumar Chirugudu, a 35-year semiconductor veteran who once built satellite payloads for ISRO and has since scaled engineering organisations across three continents, joins as president and chief operating officer, effective immediately.
THE MAN AND THE MANDATE
The appointment is, by any measure, a serious hire. Ravi Kumar Chirugudu comes to Tessolve after senior leadership stints at HCL Technologies, Altran and Wipro, where he managed large profit-and-loss portfolios and oversaw cross-regional teams. Over the course of his career, he has been instrumental in bringing more than 1,000 new products to market across the high-tech, energy and manufacturing verticals. Before the private sector claimed him, he began his working life as a scientist at the Indian Space Research Organisation, contributing to research and development in charge-coupled device technology and satellite payloads, a foundation that shaped everything that followed.
In his new role, he will lead Tessolve’s global growth strategy: expanding its engineering capabilities, deepening customer relationships and accelerating innovation across semiconductor and high-performance computing domains. The brief is broad, but the context is specific. Tessolve operates in the $550 billion global semiconductor market, and its recent moves, the acquisition of Germany’s Dream Chip Technologies and the TPG funding round, have sharpened both its reach and its expectations.
Srini Chinamilli, co-founder and chief executive of Tessolve, is characteristically direct about why Ravi Kumar Chirugudu was the choice:
“As we scale our global semiconductor and system engineering capabilities, Ravi’s appointment marks an important step forward. As global semiconductor demand continues to accelerate across industries, it is creating significant opportunities across the semiconductor lifecycle, from design, packaging, validation and systems integration. Ravi’s deep knowledge and leadership in this ecosystem brings the right mix of industry expertise, customer connect and execution capability, which will play a key role in strengthening our position as a trusted global engineering partner and reinforcing our market leadership.”
THE NEW ARRIVAL SPEAKS
Ravi Kumar Chirugudu, for his part, frames the move in terms of timing and culture, two factors that veteran executives tend to weigh as heavily as title or compensation:
“I am happy to join Tessolve at a time when the industry is rapidly evolving towards more complex, AI-driven systems. What stands out to me is its strong people-first culture and its commitment to bringing value to its customers. The strength of its global team, combined with its deep expertise in semiconductor innovation and next-generation product engineering, creates a solid foundation to build differentiated, scalable solutions. I look forward to working closely with the team to drive strategic growth and strengthen its role in shaping the global semiconductor ecosystem.”
The reference to AI-driven systems is not incidental. The semiconductor industry is in the midst of a structural reshaping, driven by the insatiable compute demands of artificial intelligence. For engineering services firms like Tessolve, which offers end-to-end capabilities from silicon design to packaged parts and invests in high-performance computing, high-speed interfaces, photonics and 5G, the moment is both an opportunity and a test. The company says it is well positioned to capture the next wave of industry growth. Ravi Kumar Chirugudu is now the person who has to prove it.
He came in from outer space, literally, and spent three decades learning how the semiconductor industry works from the inside out. Now Tessolve is betting that accumulated knowledge can help it cross the next frontier. In the $550 billion global chip market, the gap between ambition and execution is measured in engineering hours and leadership quality. Tessolve has just gone shopping for both.
