Sony Group Corp. offered a worse-than-expected profit outlook for the current fiscal year, signaling caution about the impact of the global consumer spending slump on its entertainment businesses.
The Tokyo-based firm said it expects operating income of ¥1.17 trillion ($8.7 billion) in the year ending March 2024, below average analyst estimates of ¥1.27 trillion. The company reported operating profit of ¥128.5 billion for the quarter just ended, down 7% on the prior year but slightly above expectations.
Sony had no major new releases from its in-house game studios in the quarter just ended. That limited growth in the company’s PlayStation division, although shipments of PlayStation 5 consoles improved as supply constraints eased. Consumer response to the company’s just-launched PlayStation VR2 headset has also been muted.
Read more: Sony PSVR2 Headset Off to Slow Start as Metaverse Push Sputters
The image sensor division was in a seasonal lull, as major customers like Apple Inc. generally buy large quantities of the semiconductors closer to the launch of their flagship devices, which in the case of the iPhone usually comes around the month of September.
Music streaming has been a bright spot for Sony. Growing use of streaming services on mobile devices has helped the company’s bottom line, thanks to its control of the publishing rights for many of the most popular artists.
Sony is gearing up to increase output of the PS5, which is still establishing the broad user base it needs to get the virtuous cycle of software and hardware sales reinforcing one another. Analysts see the current fiscal year as crucial to its success.
