Sony Entertainment chief leaving to head Snap board
LOS ANGELES — The CEO of Sony’s underperforming entertainment division, Michael Lynton, announced Friday that he would step down to focus more intently on the popular messaging service Snapchat, where he was an early investor.
Lynton, who weathered various corporate crises at Sony Entertainment over his 13-year tenure, including a devastating cyberattack and a battle with activist investors, will step down Feb. 2, the company said. After that, Kazuo Hirai, the president and CEO of Sony Corp., based in Tokyo, will take a more hands-on role at the conglomerate’s movie, television and music division, at least for a time.
Hirai will begin keeping a second office at Sony’s historic studio complex in Culver City (Los Angeles County) the company said, and take the additional title of co-CEO of Sony Entertainment. Lynton will also serve as co-CEO for six months starting in February, to help Hirai learn the inner workings of the fast-changing movie and television businesses and select a permanent successor.
In the meantime, Lynton will officially become chairman of the board at Snap Inc., which owns Snapchat. Snap is expected to go public this spring, with an eye toward being valued at $30 billion or more. As chairman, Lynton is not expected to play a direct management role, but rather focus on matters involving strategy and governance in support of Snap CEO Evan Spiegel.
“I have been involved with Evan and Snapchat since its early days, and, given its growth since then, decided the time was right,” Lynton said in a statement. He added that he is confident that the broad changes and new management team at Sony will bear fruit.
Despite wrenching turnaround efforts — Lynton hired a new movie chief in 2015 — Sony’s film operation, which includes Columbia, Screen Gems and TriStar, has experienced a prolonged shortage of breakout hits. Last year, Sony released 22 movies (not including those distributed by its art house unit), and collected $911.5 million at the domestic box office, with moderate successes like “The Angry Birds Movie” offset by clunkers like “The Brothers Grimsby.”
Among the six major Hollywood studios, only Paramount fared worse, with 15 releases taking in $876.8 million. The leader, Walt Disney Studios, where Lynton worked in the 1990s, had 13 releases and $3 billion in domestic sales.
In a statement, Hirai said Lynton’s structural changes “set the path for restoring profitability and future growth, though we recognize current challenges in the motion picture businesses and its turnaround will take some time.”
Hirai emphasized that the studio is not for sale — a persistent topic of Hollywood speculation — calling movies, television and music “essential parts of Sony.”
Although the studio’s top television executive was pushed out in June after clashing with Lynton, Sony’s small-screen business has been a bright spot. It makes “The Crown” for Netflix, “Blacklist” for NBC and “The Goldbergs” for ABC, in addition to lucrative game shows “Jeopardy” and “Wheel of Fortune.”
Sony Music, which went through management changes in October, has strengthened its position by focusing on growth areas like streaming.