Sony first-half net profit doubles, forecast revised up

Sony first-half net profit doubles, forecast revised up

The firm's movie unit continues to struggle as the pandemic keeps theatres around the world shuttered and delays new releases

Sony Playstation 4 gaming items are display for sale at a store in Tokyo. Credit: AFP Photo

Japan's Sony on Wednesday reported net profit doubled in the April-September period and revised up its full-year net profit forecast, citing growth in key sectors -- including gaming -- and financial factors.

The results beat analyst expectations, and came as the tech giant gearing up to launch its much-anticipated PlayStation 5 console next month, setting up a holiday season head-to-head with the new Xbox.

The gaming sector has been one of the few beneficiaries of the coronavirus pandemic, with people around the world forced indoors by lockdowns increasingly turning to gaming, with title downloads and streaming soaring.

Sony said net profit soared 103.8 per cent to 692.89 billion yen ($6.65 billion) for the first half, and forecast annual net profits of 800 billion yen, up from an earlier 510 billion yen forecast.

The first-half results were due in part to financial factors, including positive tax benefits, but also reflected a strong performance in games and network services, music streaming and financial services.

The strong performances in the games and music sectors also drove the upwards revision in the full-year net profit forecast, with Sony saying it was seeing "higher-than-expected sales of games software, primarily add-on content" and an increase in music streaming revenues.

But it was not all good news, with the firm's movie unit continuing to struggle as the pandemic keeps theatres around the world shuttered and delays new releases.

The image and sensing unit was another loser, with decreasing sales of sensors for mobile products only partially offset by an increase in sales of sensors for digital cameras.

Analysts said the pandemic was having a varied effect across the different segments that make up Sony's business.

"Sony enjoyed lockdown-related demand for video games in the first half. But the negative impact of the pandemic on its movie businesses was quite big and will remain sizable for the second half," said Hideki Yasuda, an analyst at Ace Research Institute in Tokyo.

"The impact of the coronavirus on Sony's entire business was smaller than expected but is still weighing on Sony's earnings."