Sony reports first-quarter net profit rise of 53.3 percent

Sony said Tuesday its net profit surged 53.3 percent in the first quarter, but warned annual profits were likely to see double-digit falls compared with the previous fiscal year.

The media-electronics conglomerate said its net profit for the April-June quarter reached 233.25 billion yen ($2.2 billion), reporting “significant increases” in its game and network services and financial services segments.

But the surge also came on strong gains in equity securities, which pushed up the firm’s pre-tax income.

Its operating profit, however, slipped 1.1 percent to 228.39 billion yen on sales of 1.97 trillion yen, up 2.2 percent.

And the company warned annual net profit for the year to March was forecast to drop 12.4 percent to 510 billion yen on an annual operating profit of 620 billion yen, down 26.7 percent.

The PlayStation manufacturer said it expects annual sales to post a modest 0.5 percent increase to 8.3 trillion yen.

While global demand for games downloads spiked this year as lockdowns forced people to stay at home, the pandemic has brought a string of negative factors for Sony, including a slump in manufacturing, music event cancellations and movie theatre shutdowns.

“Lockdowns have continued affecting Sony’s production lines while hitting hard sales of its electronics products and at theatre-release movies,” Hideki Yasuda, an analyst at Ace Research Institute in Tokyo, told AFP ahead of the results.

“It was quite a tough quarter for Sony, as negative factors outnumbered positive ones. Sony is still expected to recover gradually for the rest of the fiscal year but on the condition that a major second wave of the pandemic doesn’t emerge.”

If there is a serious resurgence of the virus, “it will be a different story,” Yasuda warned.

The much-anticipated next version of the PlayStation is expected later this year, which analysts say has helped to sustain the firm’s share price.