Sony Expects Q1 2023 Profits to Slip Despite Record PS5 Sales

Sony Group on Friday said PlayStation 5 sales will jump by six million units this business year, but forecast its profit will slip from a record high as weaker financial services sales offsets gains from gaming, music and movies.

The Japanese company said it expects operating profit in the year to March 31 to fall 3.2 percent to JPY 1.17 trillion ($8.65 billion, roughly Rs. 70,776 crore), lower than an analysts’ average estimate of a JPY 1.275 trillion (roughly Rs. 76,857 crore) profit, according to Refinitiv data.

The improved performance of its gaming unit, however, will come as a relief to the entertainment and electronics conglomerate after it struggled to make enough PlayStation 5 game consoles to meet demand during the COVID-19 pandemic because of semiconductor supply chain disruptions.

“We can now deliver PlayStation 5 to almost anywhere in the world without keeping our customers waiting,” Sony Group President Hiroki Totoki said at a press briefing after the company announced its results.

Sony, which competes with Xbox maker Microsoft and Switch provider Nintendo, said it expects to sell a record 25 million PlayStation 5 (PS5) consoles this business year, up from 19.1 million in the previous 12 months and more than double the number it sold the year before that.

For this business year, the company forecast profit at its gaming and network unit to rise by 8 percent to JPY 270 billion (roughly Rs. 16,274 crore). It said it expects earnings at its music and pictures divisions to be slightly higher, with profits from financial services falling by a fifth.

Sony also predicted that image sensor sales will dip by 5.8 percent to JPY 200 billion (roughly Rs. 12,058 crore).

The firm said overall operating profit for the three months that ended March 31 fell 7.3 percent to JPY 128.5 billion (roughly Rs. 7,748 crore), with full year profit nudging up to a record JPY 1.21 trillion (roughly Rs. 72,976 crore).

© Thomson Reuters 2023