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Sony posts record Q1 profit on pandemic demand for devices and content

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Reuters

<div class="embed-wrap"><figure data-feedback="fb:likes,fb:comments"><img alt="PlayStation 5" src="https://sa.kapamilya.com/absnews/abscbnnews/media/2020/business/06/12/playstation-5.jpg"/></figure></div><p>TOKYO - Sony Corp raised its earnings outlook on Wednesday after a record first-quarter operating profit helped by pandemic stay-at-home demand for PlayStation 5 consoles, TVs, music and movies.</p><p>Operating profit for the quarter ended June 30 rose to 280.1 billion yen ($2.57 billion) from 221.7 billion yen a year earlier, topping the 207.96 billion expected by 10 analysts, Refinitiv Eikon data showed.</p><p>It raised its profit forecast for the year through March 2022 to 980 billion yen from 930 billion, bringing it closer to the 1 billion yen average estimate from 25 analysts.</p><p>Sony had expected growing pandemic demand for its devices and content to wane as coronavirus lockdowns eased, but with fresh waves of COVID-19 infections sweeping the world, restrictions are still common.</p><p>A shortage of semiconductors, however, which is also affecting the likes of Apple, means it cannot produce enough PlayStation games consoles to meet demand.</p><p>Those supply-chain constraints could also affect the production of other consumer electronic devices, Chief Financial Officer Hiroki Totoki told a news briefing after Sony&#x27;s results.</p><p>&quot;We use a lot of semiconductors and it is a source of concern,&quot; Totoki said. &quot;We can&#x27;t become complacent,&quot; he added.</p><p>Sony in May said it expected to sell 14.8 million PS5 units this fiscal year. Launched in core markets in November 2020, the console, which sells for as much as $500, quickly sold out.</p><p>Sony has secured enough chips to achieve that production target, Totoki said.</p><p>Sony sees the game console as a way to connect its traditional consumer electronics with its growing content business by encouraging online game downloads and sign-ups for subscription services.</p><p>As it streamlines its consumer electronics business, Sony is beefing up its entertainment content and distribution business. In December it agreed to buy AT&amp;T Inc&#x27;s T.N animation business Crunchyroll with 3 million subscribers worldwide.</p><p>In June it bought Housemarque, a Finnish game software maker. I</p><p>Sony also increasing movie offerings on streaming services offered by Walt Disney Co and Netflix as the pandemic delays movie theatre releases.</p><p>Higher production costs, however, dented profitability, the company said.</p><p>In May, the company indicated that it would continue to expand its content business through acquisition when it said it would spend 2 trillion yen over the next three years on strategic investments, including a push to expand subscribers to its gaming and entertainment services.</p><p>In its financial division, Sony posted a 16.8 billion yen one-time loss resulting from an unauthorized fund transfer at a Bermuda subsidiary, SA Reinsurance, in May.</p><p>The company said it reported the payment to local authorities and was trying to recover the money.</p><p>($1 = 109.0400 yen)</p><ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/business/07/29/21/sony-says-ps5-sales-top-10-million-consoles-as-demand-surges">Sony says PS5 sales top 10 million consoles, as demand surges</a></li>	<li><a href="https://news.abs-cbn.com/business/06/12/20/sony-pulls-back-curtain-on-playstation-5-console">Sony pulls back curtain on PlayStation 5 console</a></li></ul><div><strong>RELATED VIDEO</strong></div><figure class="op-interactive"><iframe allow="autoplay; fullscreen" frameBorder="0" height="100%" id="ivsplayer01" scrolling="no" src="https://player.ivideosmart.com/ivsplayer/v4/dist/html/iframe-src.html?iframeid=ivsplayer01&amp;key=e8c22c015ca9eafa76f1e3edfa03c603&amp;spid=3001339&amp;vid=1740670" width="100%"></iframe></figure><div class="iwantbar">Watch more in <a href="//www.iwantv.com.ph/">iWantv</a> or <a href="//tfc.tv/">TFC.tv</a></div><div> </div>

Sony raised its earnings outlook after a record first-quarter operating profit helped by pandemic demand for PlayStation 5, TVs, music and movies.