Sony Group Corp. reported a significant rise in operating profit for the July-September quarter, driven largely by its game and network services sector, which helped mitigate reduced revenue from TV production delays. The Japanese electronics and entertainment conglomerate disclosed a 73% increase in quarterly operating profit, reaching 455.1 billion yen from 263 billion yen a year earlier. This growth was primarily attributed to robust sales in Sony’s game segment and improved demand for image sensors.
Sony’s diverse portfolio spans gaming, music, and semiconductor businesses, and it maintained its forecast of 1.31 trillion yen ($8.51 billion) in profit for the fiscal year ending in March, close to analysts’ consensus of 1.34 trillion yen as polled by LSEG. President Hiroki Totoki, at an earnings briefing, highlighted the profitability improvements in Sony’s gaming hardware, spurred by a smooth transition of consumers from the PlayStation 4 to the PlayStation 5, boosting related software sales.
The game and network services segment contributed more than a third of Sony’s total revenue, with profit almost tripling to 138.8 billion yen during the period. Sony also increased its annual profit outlook for the gaming sector to 355 billion yen, up from the previous projection of 320 billion yen. The revision led to a minor adjustment in Sony’s group annual revenue forecast, now expected to reach 12.71 trillion yen.
Sony continues to anticipate annual sales of 18 million PlayStation 5 units, despite a 22% decline in second-quarter PS5 sales, down to 3.8 million units from the same period last year. Challenges within the gaming industry, including escalating development costs, prompted Sony to close two PlayStation studios last month, including Firewalk Studios, the developer of “Concord,” which launched in August.
In contrast, the company’s pictures segment saw a dip, with quarterly profit down to 18.5 billion yen from 29.4 billion yen the previous year. The decrease was partially linked to postponed TV show releases following the 2023 Hollywood strikes.
Featured image courtesy of The Japan Times
Follow us for more updates on Sony’s profit.