Updated Nov. 21, 2013 12:58 p.m. ET
Sony Corp.'s SNE +0.65% Sony Corp. ADS U.S.: NYSE $18.65 +0.12 +0.65% Nov. 21, 2013 3:12 pm Volume (Delayed 15m) : 2.55M P/E Ratio 26.00 Market Cap $19.42 Billion Dividend Yield N/A Rev. per Employee $530,313 11/21/13 Sony To Focus More on TV Progr... 10/17/13 Retail Videogame Sales Soar in... 10/08/13 Wave of Christian Movies Is Te... More quote details and news » film studio will make a "significant shift from motion pictures to higher margin television production and networks," Sony Entertainment Chief Executive Michael Lynton told investors Thursday.
The announcement is an acknowledgment that despite its prestige, Sony's movie business is more financially challenged than television right now. Sony Pictures Entertainment has had a difficult year at the box office with flops like "White House Down" and "After Earth," while its television business, which produces 38 shows like "Breaking Bad" and "The Blacklist" and operates networks in more than 150 countries, is faring better.
Mr. Lynton explained his plans during a presentation to investors on the Sony Pictures lot near Los Angeles, where the company is providing more details on its entertainment business than ever before. The decision to hold the investor day came after activist investor Daniel Loeb unsuccessfully pushed the company this summer to spin off 20% of the equity in its entertainment assets and criticized the management of Mr. Lynton and his team.
Mr. Lynton also provided new fiscal guidance for the entertainment operations. In Sony's fiscal year ending March 2015, Mr. Lynton said the company's pictures business, including film and television, expects revenue of $8.4 billion and an operating margin of 7.4%. In the music business, Sony expects revenue of $4.8 billion with 9.5% operating income margin.
Between 2013 and 2017, Mr. Lynton said the pictures business revenue will enjoy a compound annual growth rate in the low-to-mid-single digits, while operating income will grow from high single to low double digits. In the music business during the same period, revenue is expected to be flat to slightly up, while operating income will grow in the mid-to-high-single digits.
The company hasn't previously provided such detailed guidance for its entertainment businesses.
Write to Ben Fritz at ben.fritz@wsj.com
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