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Sony stock surge gives new CEO the hottest start in 23 years

Oct 31 2018 15:05
Yuji Nakamura, Bloomberg
Sony PlayStation 4

A controller for the new PlayStation 4 is on display at the Sony PlayStation E3 media briefing in Los Angeles. (Jae C Hong, AP)

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Ken Yoshida is off to the hottest start of any Sony chief executive officer in at least two decades, after strong earnings that sent shares soaring on Wednesday.

The Tokyo-based company has outperformed the Nikkei 225 by about 20 percentage points since Yoshida took charge in April, beating results from prior Sony CEOs dating back to the mid-1990s over an equal period of time.

Shares jumped as much as 7.1% on Wednesday after Yoshida raised his full-year profit outlook and handily beat analyst estimates, fuelled by record profits in video games.

Bloomberg calculated the early tenure share performance for the CEOs by looking at the first two full earning periods under each leader.

Shares under Yoshida have done better than his mentor Nobuyuki Idei who took over Sony’s day-to-day operations in April 1995 and oversaw the launch of the original PlayStation game console. Yoshida also currently tops Howard Stringer, who took charge in June 2006 and gutted the company’s consumer electronics division - including its robot dog Aibo.

Kazuo Hirai, who became CEO in 2012, appointed Yoshida as CFO and the two were largely responsible for continuing restructuring with deep cuts in cell phones, TVs and laptops, while doubling-down on PlayStation games and camera chips. Those moves are largely responsible for the stock’s current gains.

Yoshida is known as a numbers guy who takes a top-down approach to business, carefully studying new technologies and then entrusting lieutenants to carry out his decisions. He’s also known for his focus on the company’s stock, including a Bloomberg Terminal in his office which he uses to check shares and news, he told Bloomberg in May.

Among Yoshida’s latest moves is reversing Stringer’s decision and bringing back Aibo last year. At a February press conference announcing his appointment, he said the digital mutt was now his favourite Sony product.

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