Sony's Profit Soars as Gaming Sales Offset Weak Movie Performance

08.11.2024

TOKYO, Nov 8 (Reuters) – Sony (6758.T) reported a 73% increase in operating profit for the July-September quarter, driven by strong sales in its gaming and network services, which helped offset a decline in its movie division. The company maintained its full-year profit forecast of 1.31 trillion yen ($8.51 billion), in line with the 1.34 trillion yen estimate from 24 analysts surveyed by LSEG.

Sony’s operating profit for the quarter surged to 455.1 billion yen, up from 263 billion yen a year earlier, with significant contributions from image sensor sales. In addition to rising third-party software sales, Sony President Hiroki Totoki highlighted the improved profitability of its gaming hardware business, noting the smooth transition from PS4 to PS5, which drove higher software sales.

The gaming and network services segment accounted for more than a third of Sony’s revenue, with its profit nearly tripling to 138.8 billion yen during the quarter. The company also released an upgraded version of the PS5 with enhanced graphics on Nov. 7. It raised its gaming sector annual profit outlook to 355 billion yen from 320 billion yen, contributing to a slight increase in its overall revenue forecast to 12.71 trillion yen.

Although PS5 sales were down 22% year-on-year to 3.8 million units for the quarter, Sony maintained its sales target of 18 million units for the fiscal year. The company also acknowledged the rising costs of game production and announced plans to shut down two PlayStation developers, including Firework Studios, which launched the game “Concord” in August.

Sony’s movie division saw a significant profit drop, from 294 billion yen last year to 185 billion yen this quarter, due to delayed film releases caused by the 2023 Hollywood strikes.

($1 = 152.8700 yen)