Sony Corp (TYO:6758) announced on Thursday that it is considering a potential spinoff and listing of its financial services unit within the next two to three years. The move saw Sony’s Japanese shares surge over 6% in late-morning trade.
Sony Financial Group, the wholly-owned unit, offers services such as insurance, banking and venture capital investments. Sony said it will assess the spinoff and listing of the unit with the intent of facilitating “sustainable growth” in the business. The unit is likely to be listed in Japan, and Sony will hold a stake of slightly less than 20% in the spinoff.
The move comes as Sony doubles down on its core entertainment business that produces movies, music and videogames, as well as its image sensor business. The firm is one of the world’s biggest videogame makers, and is also a key supplier of image sensors for smartphones. Sony logged a record-high annual revenue for 2022, while profit also beat expectations on strong sales from its chip division.
Sony is facing a potential downturn in its image sensor division, especially amid waning demand among Chinese smartphone makers. A broader slowdown in chip demand across the globe is also expected to dent margins in the business. The company is pinning its hopes on the second generation of its PlayStation VR virtual reality gaming headset.