Sony upgrades full-year forecast, logs brisk quarterly profit
Sony on Tuesday revised upward its full-year profit and sales forecast, reporting first quarter profits nearly tripled from a year earlier, as it extends a roaring recovery under its new CEO.
The electronics and entertainment giant now forecasts 500 billion yen ($4.5 billion) in net profit for the fiscal year to March 2019, up from its earlier estimate of 480 billion yen.
Annual sales are now projected to rise slightly, with operating profit unchanged.
The upward revisions were largely due to foreign exchange gains, brisk sales of PlayStation 4 software and the growing value of its shares in top streaming platform Spotify.
For the April-June quarter, it reported a net profit of 226.4 billion yen, up from 80.9 billion yen from a year earlier.
Sales of PlayStation 4 products were doing "better than expected" as a result of popular gaming titles, Yasuo Imanaka, an analyst at Rakuten Securities in Tokyo, said before the results were announced.
"[The] PS4 is passing its peak but the slide is not steep," Imanaka told AFP.
Sony also benefitted from the sale of part of its stake in Spotify when the service made its stock debut.
The figures are Sony's first quarterly results under new CEO Kenichiro Yoshida, who replaced Kazuo Hirai in April.
The upward revisions confirm a smooth transfer of the reins at Sony following its return to health after huge losses in recent years.
"The Yoshida team got off to a flying start," said Hideki Yasuda, an analyst at Ace Research Institute in Tokyo.
"It has been a smooth power transfer," after Sony's recovery, and the company "is forecast to continue displaying a strong performance at quite high levels," he added.
Hirai spent the past six years salvaging the company from deep financial troubles, leading aggressive restructuring and terminating thousands of jobs while selling business units and assets.
In May, Sony unveiled a $1.9-billion deal to buy industry titan EMI Music Publishing, which has the rights to songs by the likes of Queen and Pharrell Williams.
The agreement is Sony's first major deal under Yoshida, who noted the music business has enjoyed a "resurgence" in recent years due to streaming services provided by companies like Spotify and Apple.
On the Tokyo Stock Exchange, Sony shares fell 0.63 percent to 5,828 yen on Tuesday just before the results were announced after the market close.
Sony stocks have gained 13 percent since the new CEO took office April 1.
For the year to March 2018, Sony's annual net profit hit a record high as it marked the first sales gain in three years.