Sony Corp. (NYSE:SNE) has changed its mind about selling its lithium ion battery division, according to a report from the Nikkei newspaper seen by Reuters. The company had been working towards selling the unit, but has decided to abandon those plans as the weak yen and higher demand for smartphone batteries has given the company some hope about the unit’s prospects.
Sony has been trying to sell the unit for two years as it has failed to perform in the face of competition from cheaper rivals based in South Korea. Nikkei reported that Sony’s battery division has seen a slight increase in its business as of late. A turnaround fund from the Japanese government tried to push a sale of the unit to automaker Nissan (NSANY.PK) earlier this year, but no progress has been made and Sony told the fund it now plans to keep the unit, according to anonymous sources who spoke to Nikkei.
Sony’s consumer electronics business has struggled in recent years, and the company is placing some big hopes on its recently released PlayStation 4 video game console to help revive that division. Earlier this summer, activist investor Dan Loeb pressured the company to split its consumer electronics business from its more-successful entertainment arm, but CEO Kazuo Hirai declined to act on Loeb’s proposal.
Sony reported some disappointing second-quarter earnings results soon after the PlayStation 4 was launched. Despite the hubbub surrounding the PlayStation 4, Sony reported weak earnings in its second-quarter, leading the company to cut profit forecasts for the year.
Sales outlooks for consumer products like TV sets, personal computers, and cameras were all lowered, while the video games business reported an operating loss of $8 million despite seeing revenue increases of 5.1 percent year over year. Sony saw its PlayStation 4 fly off the shelves during holiday shopping and is hoping that the device can help bring some glory back to its electronics business.
More from Wall St. Cheat Sheet:
- Will Sony’s PS4 Be the Key to a Turnaround?
- Loeb is Piling on the Pressure For a Sony Split
- Sony Sold 2.1 Million PS4s Despite Limited Supply
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