Sony announces first-ever share buyback, stock rises 5%

Sony shares had plunged 14% this week after the company reported a lower-than-expected profit. (Reuters pic)

TOKYO: Sony announced on Friday a share buyback of 100 billion yen (US$910 million) – its first ever aimed at boosting shareholder returns – sending the Japanese electronics and entertainment company’s shares up more than 5%.

Sony said the buyback, to be conducted through March 22, would be equivalent to 2.36% of its outstanding stock.

“Our financial health has improved enough to conduct the repurchases,” a Sony spokesman said, as the company reinvented itself as an entertainment company with stable revenue from music content and gaming, after battling years of losses with price-competitive consumer electronics.

The spokesman said Sony also took into account current share price levels.

Sony shares had plunged 14% this week after the company reported a lower-than-expected profit as its previously thriving gaming business sagged, though a one-off gain related to its acquisition of EMI nevertheless pushed the quarterly result to a record high.

Sony’s announcement comes a day after SoftBank Group Corp’s shares jumped 17% after the Japanese tech investment giant unveiled a record share buyback.