The chief executive of Sony Group, Kenichiro Yoshida, who helped further the company’s decades-long push to transform itself from a consumer electronics brand into a global entertainment company, is stepping down.
Hiroki Totoki, 60, a top Sony executive who has worked closely with Mr. Yoshida in leading that drive, will take over as chief executive in April, the company said in a statement on Wednesday. Mr. Yoshida, 65, will stay on in his position as chairman.
The switch-up at the top is only the eighth in the 78-year history of Sony, which was founded as an electronics shop in Tokyo in the wake of World War II. Before it lost its lead in recent decades, Sony was the first name in consumer electronics, churning out handfuls of iconic inventions like the Sony Walkman, which it introduced in 1979.
Over the past two decades, Sony faced rising competition in devices such as computers and televisions from rivals in the United States and South Korea, and the storied Japanese tech giant began rebuilding itself as a gaming and entertainment powerhouse.
Mr. Yoshida took over as chief executive in 2018, after a turbulent decade in which the company reported years of losses and was forced to exit a number of unprofitable businesses including personal computers. Mr. Yoshida inherited from his predecessor, Kazuo Hirai, a company that was no longer bleeding red ink. He sought to maintain momentum.
During Mr. Yoshida’s seven years leading Sony, the Japanese company spent billions of dollars building its vast empire of games, music and movies. Those segments accounted for more than three-fifths of its revenue in the most recent July-September quarter — up from less than a third a decade earlier.
Mr. Yoshida “solidly guided Sony’s turnaround,” said Mika Nishimura, a senior analyst at Okasan Securities in Tokyo. He pushed Sony to focus on businesses that produce recurring revenue like subscription services for its PlayStation, and found ways to connect its lines of music, movies and games, she said.
For the current fiscal year ending March 31, Sony is forecasting an operating profit of $8.4 billion, up more than 75 percent from its earnings in 2017, before Mr. Yoshida took over. Buoyed by the recent strength of its digital games and a weakened yen, Sony’s shares have recently traded at their highest level in more than two decades.
The company’s stock gained 3.8 percent on Wednesday in Tokyo.
Still, Sony is expected to face significant challenges in the next phase of its entertainment push: diving deeper into the global battle over content, Ms. Nishimura said. There, Sony will have to face off with the likes of streaming giant Netflix, which has a market valuation that is roughly triple that of Sony’s.
Sony has been investing significantly in new material, but it needs to push even harder, Ms. Nishimura said. “The industry environment is changing and content is being consumed at such a fast pace, the pressure to continually produce hits is intense,” she said.
Mr. Totoki, who joined Sony in 1987 after graduating from Waseda University in Tokyo, has worked closely with Mr. Yoshida on bolstering the company’s intellectual property empire, since he became president in 2023.
Last year, Sony entered into talks aimed at acquiring Paramount Global, the U.S. owner of Nickelodeon, MTV, CBS and Paramount Pictures. Sony eventually decided against making a fresh bid for Paramount after an independent studio struck a deal to acquire the media giant.
In December, Sony said it planned to spend more than $300 million to increase its stake in Kadokawa, a Japanese producer and developer of animation and video games including the popular action role-playing game “Elden Ring.”
The announcement of Mr. Totoki’s new role as chief executive was accompanied by a flurry of other management shifts disclosed by Sony on Wednesday.
Those include the appointment of Lin Tao, an executive from Sony’s gaming unit, as chief financial officer, the first time a woman will hold that rank at Sony. Hideaki Nishino will become chief executive of Sony’s PlayStation unit, which previously had been run by two executives.
Though it has made significant strides, Sony still has a range of businesses in electronics and hardware, and will need to channel resources further to more substantively become an entertainment-focused group, said Ayaka Inomata, an analyst at Daiwa Securities.
“Given that Mr. Totoki has worked closely with Mr. Yoshida for years,” Ms. Inomata added, “his vision for the company won’t be a big departure.”
Hisako Ueno contributed reporting.