fbpx

Join our community of traders FOR FREE!

  • Learn
  • Improve yourself
  • Get Rewards
Learn More

Sony Corp. share price down, reports rising profit on strong PS4 sales

Sony Corp. posted quarterly earnings today, revealing income was significantly boosted by its bestseller PlayStation 4 gaming console. Successful movies also added to revenue, while the company still projected a net loss through years end.

Revenue for the three months ended June 30 were logged at ¥1.809 trillion (about $17.74 billion), up 5.8% on an annual basis. Revenues were boosted by a weaker yen, which depreciated 3.4% against the US dollar in the past year, and on a constant currency basis sales increased by 3%. The companys operating income increased 96.7% to ¥69.8 billion, while net income stood at ¥26.8 billion, compared with ¥3.1 billion in the year before, after an effective tax rate of 38.1%.

CEO “Hirai’s reforms are starting to produce results, and he was fortunate that movies and the PS4 sold well,” Makoto Kikuchi, Tokyo-based chief executive officer for Myojo Asset Management Co., said for Bloomberg. “It’s creating an atmosphere in which Sony can make a profit.”

Sony attributed the improving performance to the surprisingly positive sales of its “new-gen” PlayStation 4 gaming console, which boosted the Games and Network division revenue by 95.7% to ¥257.5 billion. Sony sold 18.7 million console units last year, while its top competitor – Nintendo sold 16.7 million. Nintendo posted earnings yesterday, revealing a worse-than-expected quarter, primarily due to sluggish console sales.

Sonys Pictures department, which includes motion pictures and TV productions also saw a sizable increase in income at ¥194.8 billion, up 22.6% from the year before, with strong theatrical performances of The Amazing Spider-Man 2 and 22 Jump Street .

The mobile communications division recorded a 10.1% increase in sales to ¥314.3 billion, and Sony lowered its projection of full-year smartphone sales to 43 million, down from 50 million. The worlds leading smartphone manufacturer, Samsung, posted its own quarterly earnings earlier today, to reveal a shrinking market share amid growing competition in the sector.

Full-year revenue forecast was adjusted to ¥7 800 billion, which would match last years performance, while operating income was projected to be at ¥140 billion, four times the figure of 2013. Net loss was still in sights though, forecast at ¥50 billion, while the net result for 2013 was a -¥128.4 billion.

Sony Corp closed 1.06% lower to trade at ¥1 772 (about $17.37) in Japan today, which was before the reported was posted, for a market capitalization of ¥1.87 trillion (about $18.33 billion). According to the Financial Times, 18 analysts offering 12 month price targets for Sony Corp have a median target of ¥2 020, with a high estimate of ¥2 700 and a low estimate of ¥1 360. The median estimate represents a 14.00% increase from the last price of ¥1 772.

TradingPedia.com is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover Forex, Price Action and Social Trading.

Related News