Yahoo Finance Sony Pictures Profits Slip by 10%, Despite Marginal Sales Gain
Sony Group Corporation saw its sales climb by 19% to JPY13.0 trillion in its financial year to March 2024, boosted by a sharp depreciation of the Japanese currency. Net profits for the group were down 3% to JPY971 billion.
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(At current rates of exchange those figures translate as $83.3 billion of revenues and $6.66 billion on new profits.)
It was a similar scenario at Sony’s ‘pictures division,’ which comprises theatrical film, TV networks and television content production. Net profits were down by 10% in dollar terms at $808 million, compared with $895 million a year earlier. That was despite sales that were up 2% to $10.3 billion.
But in the Japanese parent group’s accounts the greater value of these dollar profits showed as a much smaller decline when expressed in Japanese Yen. Net profits for the pictures division in 2023-24 came in at JPY118 billion compared with JPY119 billion a year earlier.
Sony said that pictures division revenues were boosted by increased theatrical releases and by higher revenues from anime streaming and distribution unit Crunchyroll. But that they were held back by a decrease in series deliveries which it blamed on last year’s twin Hollywood strikes. Operating profits, viewed as essentially flat, were dented by higher marketing spend in support of the theatrical titles.
The unit release 17 theatrical films between April last year and the end of March 2024. Its biggest earners were: “Spider-Man: Across the Spider-Verse” with $691 million gross theatrical revenue worldwide; followed by “Napoleon” with $221 million; and “Anyone But You” with $218 million.
For the current financial year (April 2024 to March 2025), Sony has scheduled 13 theatrical releases. These include “Bad Boys: Ride or Die” in June, “Venom: The Last Dance” in October and “Paddington in Peru” in January 2025.
The key games and network services segment produced JPY290 billion of operating income, compared with JPY250 billion in the previous financial year. Revenues were higher at JPY4.27 trillion, compared with JPY3.64 trillion.
The games sector sales decline came despite a significant currency gain and increased sales of third-party titles and add-ons. Games’ operating income was dented by increased losses on hardware and promotions and reduced performance by in-house games titles.
The music segment saw operating income increase from JPY263 billion to JPY301 billion. Sales increased from JPY1.38 trillion to JPY1.62 trillion.
Music revenues were lifted by higher revenues from streaming music and paid subscriptions as well as gains by recorded music and music publishing. There were also currency gains and higher revenues from merchandize and live music. Operating income was held back by new accounting policies for a subsidiary company and by litigation settlements.
Though management has sought to use the group’s balance sheet strength, the 2023-24 financial year was little affected by mergers and acquisition activities. In January, Sony walked away from protracted deal talks which, had they been successful, would have hugely expanded its film, TV and streaming presence in India. A dispute over liability for the deal’s failure is ongoing. Sony is also among the bidders for Paramount Global, the Hollywood studio conglomerate.
Ahead of the results announcement, Sony’s shares Tokyo Stock Exchange-traded shares ended trading on Tuesday at JPY11,930 apiece. The shares, traded in ADR form in New York, closed Monday at $76.15, some 20% off their 12-month high.
More to follow.
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