Sony Increases Annual Outlook Due to PlayStation Profits

Sony has released its financial report for the first quarter of the year, ending on June 30th, along with a revised forecast for the fiscal year. The results show a combination of positive and negative outcomes for the company. While the overall operating profit for the period decreased by 31 percent compared to the previous year, the revenue saw a significant increase of 33 percent. This growth can be attributed to the successful sales performance of Sony’s game and network services, music, imaging, and financial services divisions.

Sony believes its gaming and music segments will continue to perform well and has raised (PDF) its sales and earnings forecast for the fiscal year ending March 31, 2024 by 6.1 percent due to higher-than-expected sales from those businesses. It also expects net income to be 2.4 percent higher than its previous forecast, from ¥840 billion ($5.86 billion) to ¥860 billion ($6 billion).

For its games division in particular, Sony has revised its forecast as it expects sales of non-first-party PlayStation games to increase, including additional content. Several long-awaited games are coming to PlayStation gamers this year, including Spider-Man 2, Assassin’s Creed Mirage, Cyberpunk 2077: Phantom Liberty Expansion, Avatar: Frontiers of Pandora, and EA Sports FC.

This expected increase in sales of non-first-party works is driven by lower costs and expenses. Even so, they are also offset by “decreasing profitability of PlayStation 5 hardware.” Sony has recently dropped PS5 prices in several regions around the world. While this means a decrease in overall revenue for the console, it could also lead to people eventually buying a PS5, which in turncan lead to an increase in game purchases.

Note that Sony has shipped 3.3 million PS5 units in the first quarter of the year. That’s almost half of the previous quarter’s sales of 6.3 million units, even though the figure is for the holiday season, when companies tend to do better than usual. This is Sony’s best-ever first quarter for PS5 sales, with a total of 41.7 million units sold.

Despite revising its outlook for the full year with better numbers, Sony has lowered its expectations for mobile sensor sales due to the continued downward trend in smartphone sales. Sony Pictures’ profit also fell from the previous year, despite the success of Spider-Man: Across the Spider-Verse. The company also does not expect business to recover, and believes it will do worse than predicted last April due to the Writers Guild of America and Screen Actors Guild strikes.