Sony posts strong Q4 profit, but smartphone business continues to struggle

With limited presence and a small portfolio, it is no surprise that Xperia phones aren't selling well.

What you need to know

• Sony shipped just 0.4 million Xperia phones in the fourth quarter of the fiscal year 2020.
• It shipped 2.9 million phones in FY2020, down from 3.2 million units in the previous year.
• Despite falling sales, Sony is still not ready to give up on the smartphone market.

Sony today announced its financial results for the fourth quarter of fiscal year 2020. The company reported an operating profit of 66.5 billion yen ($610.8 million) in the March quarter, up from 35.4 billion yen during the same period a year earlier.

The Japanese tech giant could only ship around 400,000 smartphones in the January to March period, down from 1 million units in the previous quarter. While Sony shipped a total of 3.2 million Xperia smartphones in the fiscal year 2019, shipments declined to 2.9 million units last year. Although Sony admits that its mobile communications business isn't doing well, it is yet to hint at an exit from the smartphone market.

While the company's own Xperia phones aren't finding many takers, the success of Apple's latest iPhones gave Sony's image sensor division a big boost in the last quarter. However, the loss of Huawei as a client is expected to have an impact on the business unit in the near future. Sony is also facing increased competition from Samsung, which is soon expected to announce its first 200MP camera sensor for smartphones.

Unless Sony introduces massive changes to its smartphone strategy, it is unlikely to be successful in turning around the mobile communications business. However, its latest flagship phone, the Xperia 1 III, proves that the company is capable of making phones that can challenge the best Android phones from Samsung.