Japan's Sony sees profit grow on demand for games, but quake damage still unclear

TOKYO -- Sony Group Corp. reported a 32% profit growth in the fiscal first quarter Friday while warning of a negative impact from the earthquake that hit southwestern Kumamoto earlier this week.

The Tokyo-based entertainment company said its semiconductor facilities there were affected, and production remained suspended at one, while others were back up.

There was no major damage. However, the impact on Sony’s bottom line was still being assessed, so that was not included in Friday’s results. Before the quake, Sony had said it was on track to report record profit for the fiscal year.

Sony, which makes the PlayStation video game machines, Bravia TVs and “Spider-Man” movies, said net profit for the April-June period rose to 342.2 billion yen ($2 billion) from 259 billion yen. Quarterly sales edged up 8% to 2.84 trillion yen ($17.7 billion).

The 7.1 magnitude quake that struck July 28 in the Kumamoto area in Japan 's southwestern main island of Kyushu caused at least 34 deaths. It also halted operations at factories, left hundreds of homes without electricity, flattened buildings and stopped trains.

Sony’s music business did well in the latest quarter, with both digital streaming and publishing businesses recording healthy results.

Among the top-selling projects for Sony Music for the quarter were releases from Michael Jackson like “Thriller” and “Bad,” which continue to have strong global appeal, as well as more recent recordings from Ella Langley and Bad Bunny.

Sony’s imaging and sensor business saw solid profits and sales. In a separate development, camera lens maker Tamron said this week that it had received an acquisition proposal from ⁠Sony and was reviewing options.

Sony’s video-games division also did well, selling 1.6 million PlayStation 5 machines during the three months, up from 1.5 million units in January-March.

Cumulative PS5 sales are now estimated at more than 93 million machines. Active players total 125 million people, according to Sony.

The film unit did not do as well, partly because there weren’t as many box office releases in the first quarter compared to the same period a year ago. The main release for the latest quarter for its Pictures unit was “The Breadwinner,” directed by Eric Appel about a stay-home dad.

On the positive side, subscribers to Crunchyroll, a Japanese animation streaming service, continued to grow. Licensing revenue from its TV catalog also worked as a plus.

Sony is projecting a 1.2 trillion yen ($7.5 billion) net profit for the full fiscal year, up 17% on year. It expects 12.5 trillion yen ($77.8 billion) in annual sales through the fiscal year ending in March 2027, little changed from the previous year, inching up less than 1%.

Sony Group stock was trading little changed in Tokyo, compared to the previous day, after the earnings results were released.

Yuri Kageyama is on Threads: https://www.threads.com/@yurikageyama