Sony Makes It Back to Even (SNE)

For awhile this year, it looked like Sony’s stock might never recover from its battery recalls and Playstation 3 delays.

But, things have started to move Sony’s way. After opening the year at $41, Sony’s stock got as low as $37.25. The shares are now back to about $43.

Sony has done a number of things to save its own hide, and some of them may be working. The company is working on a number of ways to get its studio content onto multiple platforms, including its own Playstation portable. Sony is even working with flash memory sticks that allow movies to be played on cell phones.

Sony may also benefit now that Sharp is producing blue laser diodes in greater number. The components are essential for next-generation DVDs, and lack of product has hurt holiday sales. Sony has its own production capability, but it is tied up with the PS3. As the Financial Times points out:  "new standards are expected to generate billions in revenue for the technologies’ backers – led by Sony in the case of Blu-ray and Toshiba for HD-DVD" So, Sony’s payday in the DVD business should be getting better.

Perhaps the single most important development for Sony over the last few months is that the company is insisting that it will sell six million of the new PS3 by the end of March. That number had been in doubt as supplies of the platform were low for Christmas. 

Sony has been burdened by ugly problems and doubts on Wall St. that management could get the company back into a reasonable competitive position in media and gaming. There are some signs, at least, the the company is on the right path.

Douglas A. McIntyre can be reached at [email protected]. He does not own securities in companies that he writes about.