Sony Group (NYSE:SONY) stock is trading higher on Thursday following reports indicating its attempts to sell its cellular chipset unit, Sony Semiconductor Israel, as it shifts its strategic focus toward entertainment.

The Japanese tech and entertainment giant has engaged investment bankers to manage the early-stage sale process, Reuters reported on Thursday, citing unnamed sources familiar with the matter.

Formerly known as Altair Semiconductor, the unit supplies cellular chipsets for connected devices like wearables, smart meters, and home appliances.

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Sony acquired it in 2016 for $212 million. The business reportedly generates around $80 million in recurring annual revenue and could be valued at approximately $300 million in a potential deal. The sale could attract interest from private equity firms and players in the semiconductor sector.

The company has been doubling down on games, music, and film sectors that accounted for over 60% of its profits last year. Sony is also preparing to partially spin off and list its financial services arm later this year. Additionally, it is evaluating future options for its chips division, including bringing in partners or moving to a fab-light model.

Separately, Sony and  Honda Motor (NYSE:HMC) joint venture Sony Honda Mobility emphasized that artificial intelligence is vital in advancing autonomous driving and in-car entertainment, as the company nears the U.S. launch of its first electric vehicle.

Formed in 2022, Sony Honda Mobility aims to differentiate itself through AI by leveraging Sony's entertainment expertise and Honda's automotive capabilities to create what it describes as "mobility entertainment," Nikkei Asia reported on Thursday.

Prior reports indicated the joint venture is stepping up efforts to challenge Tesla (NASDAQ:TSLA) by launching three electric vehicles by the late 2020s. After debuting the high-end Afeela sedan in 2025, the venture plans to release an SUV in 2027 and a more affordable compact model in 2028 or later.

To cut costs and accelerate development, all three models will share the same chassis, with the compact expected to rival the size of a Toyota Corolla or VW Golf. Sony Honda Mobility also aims to keep prices down by trimming non-essential features, while the Afeela sedan will remain a premium offering priced above 10 million Japanese yen (around $66,000).

In January, the joint venture unveiled major updates for its first electric vehicle, the Afeela 1, at the 2025 CES Conference as it nears launch. They shared plans to build a four-door sedan in Ohio, with sales beginning in California in 2025 and first deliveries expected by mid-2026.

Starting at $89,900, the Afeela 1 includes a three-year subscription to selected features. A higher-end Signature trim will be available for $102,900. California residents can now place refundable $200 reservations online. With an estimated range of 300 miles, the vehicle is also compatible with Tesla's Supercharging network in the U.S.

The Afeela 1 stands out with its emphasis on advanced driver assistance systems and a built-in interactive personal agent. Designed around "mobility as a creative entertainment space," each seat will feature customizable displays and sound systems. Sony Honda Mobility CEO Yasuhide Mizuno described the car as "a buddy," combining advanced software with refined hardware to transform the driving experience.

While Sony brings its legacy in consumer electronics, from the Walkman to the PlayStation, to this venture, the company faces stiff competition in a price-sensitive EV market. Afeela 1 targets consumers who prioritize premium in-car technology and entertainment over affordability.

Price Action: SONY stock is trading higher by 1.94% to $25.75 premarket at last check Thursday.

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