Sony forecast a surge in operating earnings by fiscal 2017 as Chief Executive Officer Kazuo Hirai drives the company’s turnaround with games, image sensors and entertainment. The Japanese company today held its Corporate Strategy Meeting and unveiled a mid-term strategy that charts the path forward for the company over the next three years, starting with the fiscal year ending March 31, 2016 ("FY2015") and finishing with the fiscal year ending March 31, 2018 ("FY2017").

Sony will position Return on Equity (ROE) as its primary key performance indicator and has set a target for consolidated ROE of more than 10% and a target for consolidated operating profit of more than 500 billion yen for the Sony Group in FY2017, the final year of its mid-range corporate plan.

Sony is positioning Devices, Game & Network Services, Pictures, and Music as the segments that will drive its profit growth over the next three years. It plans to implement growth measures and engage in aggressive capital investment in these areas with the aim of achieving both sales growth and profit expansion.

In Devices, Sony aims to further bolster its competitive edge in the area of CMOS image sensors by investing to increase production capacity and enhance R&D. In Games & Network Services, the company will strive to further expand the installed user base of the PlayStation platform and PlayStation Network ("PSN"). In Pictures, Sony will focus on expanding the audience for its Media Networks business by growing ratings and increasing its channel offering, strengthening its Television Production business, and improving margins in its Motion Picture business. In Music, the Company will increase its focus on growth areas such as the streaming music market.

Sony will also prioritize the generation of steady profit and positive cash flow for Imaging Products & Solutions and Video & Sound. While Sony does not anticipate overall market growth in these areas, the company will target certain areas within each market that are unlikely to experience commoditization by continuing to offer new, high value-added products such as its advanced mirrorless single-lens reflex cameras and high-resolution audio products.

Sony's TV and Mobile Communications businesses operate in markets characterized by high volatility and challenging competitive landscapes. In view of this business environment, Sony will place the highest priority on curtailing risk and securing profits in its operation of these businesses. Since both markets are experiencing intense cost competition and commoditization, Sony will strive to further increase the added value of its products by leveraging its in-house technologies and component devices. By selecting the territories and product areas it targets, Sony will seek to limit its capital investment and establish a business structure capable of securing stable profits. Sony will also continue to explore potential alliances with other companies in these areas, in response to changes in the business landscape.

In the medical field, one of Sony's new business areas, Sony Olympus Medical Solutions Inc. is proceeding with the development of surgical endoscopy systems and other medical solutions.

Sony expects revenue from the business that makes sensors, camera modules and memory storage will rise to as much as 1.5 trillion yen in the year ending March 2018 with an operating margin of 10 percent to 12 percent.

Revenue from the games and network business could reach as much as 1.6 trillion yen with home entertainment sales, which includes TVs and speakers, of 1 trillion yen to 1.1 trillion yen.

Sales at the film unit will probably rise to between $10 billion and $11 billion in fiscal 2017. Music business revenue would be $4.8 billion to $5.2 billion in the same period, Sony said, affirming forecasts from November.