Japan's Sony Group Corp on Thursday achieved an unexpected 1% increase in second-quarter operating profit, although costs from growing sales of its PlayStation 5 (PS5) console fell.
Lower profitability in the key gaming segment also may not prevent the group from raising its full-year operating forecast by 6% to 1 trillion yen ($8.81 billion) from its August forecast, driven by expected profit growth in movies, music and electronics.
Sony said it has sold a total of 13.4 million PS5 units since its launch last November. This contributed to a 27% year-on-year increase in sales for its gaming division, although profits were lower as the conglomerate sold the hardware at below cost.
Manufacturers often sell new consoles at a loss as they build a base to install for software sales, and a shortage of components creates further problems for manufacturers of the latest generation devices.
CFO Hiroki Totoki said Sony plans to sell 14.8 million PS5 consoles this financial year, a target that takes into account the global deficit. Sales of its own games have fallen, although sales of other developers have risen.
Gaming firms' profits rose last year due to continued demand at home in the midst of the COVID-19 pandemic. According to Totoka, the number of PlayStation users has since stabilised as the company approaches the end-of-year shopping season.
Sony also said it was considering a partnership with Taiwan Semiconductor Manufacturing Co Ltd in its plans to build a chip manufacturing plant in Japan, without confirming further details, amid a corporate battle to secure a long-term stable supply of semiconductors.
Sony said group profits for July-September were 318.5 billion yen, above the average of 222 billion yen according to six analysts' estimates compiled by Refinitiv.
According to Thai Exness เข้าระบบบ, the stock traded at 13,140 yen.
The conglomerate, which covers areas such as entertainment, sensors and financial services, switched to IFRS accounting standards from US GAAP in the current financial year.
Throughout its business, Sony is engaged in a global battle for consumer attention as the entertainment giants look for growth opportunities outside the United States and mine content from non-English-speaking creators.
In a blow to Sony's pop culture reputation, South Korea's chief cultural export, boyz band BTS, announced last week that it had abandoned its Columbia Records label over a deal with Universal Music Group NV.
Other problems include an investor's attempt to oust the management of India's Zee Entertainment Enterprises Ltd, which casts a shadow over merger talks with local unit Sony.
