Sony reported a 29% decline in operating profit for the second quarter, primarily due to its imaging sensor business. Additionally, the company experienced a drop in profits in the financial services, entertainment, technology, and services divisions. During their earnings call, Sony forecast that it will ship 25 million PlayStation 5 consoles in 2023.
Sony reported an 8% year-over-year increase in revenue for the September quarter, amounting to 2.8 trillion yen, but operating profit dropped 29%, to 263 billion yen. This was below the LSEG consensus estimate of 304.4 billion yen. Weakness in the imaging sensor business and profit declines in financial services, entertainment, technology and services businesses were cited as the cause. Sony's semiconductor division alone saw a 28% decrease in profit for the fiscal second quarter. Sony provides camera chips to major tech companies such as Apple, with products featuring in the iPhone.
In spite of the fall in profit, Sony upped its sales projection for the entire year, predicting total sales of 12.4 trillion yen (previously estimated at 12.2 trillion yen) because of the beneficial foreign exchange rates.The Japanese yen has experienced a marked depreciation against the dollar, and the majority of earnings for Sony originate from outside the U.S.Sony additionally ascribed the improvement to its revenue prognosis to projected excellent performance in its gaming, music, imaging and sensing solutions sectors.
Sony anticipates its game and network services sector, the arm behind the Playstation console, gaming studios, and gaming networks, will produce more than initially estimated figures for the full year, which would, in turn, bolster the company's performance.The launch of the unique-to-PS5 Marvel's Spider-Man 2 game has seen a promising start; the game recorded 2.5 million unit sales in the first 24 hours of its release, making it the highest-selling PlayStation Studios game of all time in a 24-hour period.The fiscal second quarter saw 4.9 million Playstation 5s sold, higher than the 3.3 million recorded in the fiscal first quarter.
Sony reported on its earnings call that it anticipates its PlayStation 5 console will meet its goal of 25 million units shipped in 2023. This is a critical milestone as analysts and investors were intently watching for proof of the PS5's performance. Nintendo also gave a positive outlook this week when it announced higher-than-anticipated sales and profits for its second quarter of the fiscal year, which were buoyed by "Super Mario Bros. Movie" and the much awaited May release of the game "The Legend of Zelda: Tears of the Kingdom".During an interview with CNBC, Sony's Eric Lempel noted that this will be the first year that PS5 is "fully stocked" after the stifling shortages of 2020 and 2021, which were caused by supply chain problems."Back in 2020, we launched [PS5], but were unable to provide one to every consumer due to the supply chain issues experienced by the whole industry," said Lempel.The company's fiscal first quarter showed revenue rising 33% year-over-year to 3 trillion Japanese yen, but profit sinking 31% year-on-year to 253 billion yen. This suffering was attributed to a hiccup in its financial services and pictures division, which resulted from strikes led by the Writers Guild of America and other unions, in opposition to using AI for movie scripts.Sony is predicting a negative impact on its next fiscal year due to the strike, but is taking cost controlling steps to limit damage.
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