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CEO declares Sony has regained 'confidence, vigor'

Shareholders, though, bemoan a brand they say is losing its luster

Visitors walk past a signboard that reads "Sony's Annual Shareholders Meeting" at a hotel in Tokyo on June 15.

TOKYO -- Sony CEO Kazuo Hirai at Thursday's shareholders meeting stressed that his company has regained its confidence, thanks to reforms the Japanese corporate icon has been undertaking during the past five years.

Not all shareholders, however, were convinced that Sony is pointed in the right direction, with some raising concerns that the brand is losing its shine.

For the year ending March 2018, Sony expects to post its highest operating profit, 500 billion yen ($4.6 billion), in two decades, backed by strong sales at its gaming and semiconductor divisions.

Sony's high-water mark in terms of operating profit came in 1997, when it raked in 525 billion yen.

During the meeting, Hirai reflected on the outcome of Sony's painful restructuring program -- which included selling off its prized PC division and rescuing its television business from a pool of red ink. "The Sony that was full of confidence and vigor has returned," Hirai said during the company's 100th general shareholders meeting.

Hirai said the company must "maintain strong profitability" in the years ahead and make even more profits in gaming and from its image sensors. He said the company will continue to invest in fields like artificial intelligence, health care and virtual reality. 

"These past five years, I honestly worried about what would happen," one male shareholder told Hirai during the meeting, which drew 2,000 attendees, "but I'm finally seeing the light of day."

While Hirai also showed confidence in Sony's consumer electronics businesses, some shareholders decried what they see as a declining brand and lack of appealing products in a global marketplace where rivals like South Korea's Samsung have gained the upper hand.

"As an avid Sony fan," one said, "I always look around for its products at stores. But what is on display does not match what I really want."

There were also differences between executives and shareholders in regard to dividends and other returns. Some asked whether Sony might buy back shares to goose their price.

Hirai said shareholder returns are an important theme and that he would "make appropriate considerations" but added Sony will use its cash to expand its business.

Meanwhile, one shareholder took a jab at Sony's struggling movie business and asked whether Sony will spin off the unit. Hirai said returns from Hollywood are Sony's "most pressing issue." He went on that the unit will continue as one of Sony's "core businesses," stressing that the studio's content will become more valuable as the use of smartphones and tablets grows.

For the previous fiscal year, Sony's movie business posted an operating loss of 80.5 billion yen. This was mostly due to an impairment loss of 112.1 billion yen that was taken after a review showed shrinking DVD and Blue-ray sales will harm profit. For the current fiscal year, Sony expects its film studio arm to turn a 39 billion yen profit.

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