Sony Corp today reported a surge in first-quarter operating income with a 180.5% jump to 157.6B yen, or $1.43B, for the period ending June 30, 2017. Net income rose to 80.9B yen or $734M (all conversions are at today’s rates) for a 282.1% increase. The sharp hikes were largely down to a return to stability in the image sensors business after a devastating 2016 earthquake. Sony Pictures Entertainment narrowed its losses to 9.5B yen ($86.2M).
Sales and operating revenue in the Pictures division was up 12.3% to 205.8B yen ($1.87B). The increase came from higher turnover in the Television Productions and Media Networks business, but was partially offset by lower sales across Motion Pictures. The $86.2M operating loss for the first quarter was better than the $103M loss it clocked in the comparable quarter last year.
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Sony had a dearth of major theatrical titles in the period from April-June. Last year, that same corridor benefited from The Angry Birds Movie. This quarter’s major release was Smurfs: The Lost Village which did just $45M in domestic box office and $197M globally. Pics like June 28 release Baby Driver ($139M WW to date), and July release Spider-Man: Homecoming — a worldwide smash at $634M — don’t factor into the first quarter results. Spider-Man still has Japan to release on August 11 with China following on September 8.
Q1 had significant TV licensing revenue from such series as The Last Tycoon and Better Call Saul. However, worldwide theatrical marketing expenses (ie for Spider-Man) were higher than in the 2016 quarter.
Sony is forecasting sales in the division of 1.02B yen ($9.25B) and profit of 39B yen ($354M) for the full year which ends March 31, 2018. The past year saw a nearly $1B writedown.
The Games segment took a 59.7% downward hit in profits, to $160.1M, primarily due to the absence of a big first-party software title. Sales grew 5.4%, however, although a price reduction on the PlayStation4 partially offset that.
Music got a boost thanks to Harry Styles whose debut solo album was a best-seller during the quarter. In total, profits in the division grew 57.6% to $227M. Bloomberg notes this was aided by Sony’s partnership with Spotify which has tripled paying subscribers to 60M in the past two years.
Overall, Sony profits beat analyst estimates, according to Bloomberg and Reuters. Although Bloomberg calculates that most of the operating profit growth came from one-time items including the sale of Sony Electronics Hunan Co, and insurance recoveries from last year’s earthquake. The operating profit climb without the one-time items would still be 58%, the financial news agency reports
Shares in Sony Corp are up about 36% this year and the company is maintaining full-year operating income forecast of 500B yen ($4.5B), although it has increased its group revenue projection to 8.3T yen ($75.2B).
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