AH Sony Logo-1

Sony Reports Robust Q1, FY2016 Earnings

July 30, 2015 - Written By Kishalaya Kundu

Japanese consumer electronics giant Sony Corp. has published its Q1, FY2016 report, which shows a 39 percent increase in operating profit for the company, on the back of strong sales of its camera sensors and PlayStation 4 consoles and games. While its image sensors have seen strong demand from smartphone manufacturers, its PS4 gaming console has reportedly been outselling its nearest rival Microsoft’s Xbox gaming console since its release a couple years back. The result beats market expectations, as the company reported a quarterly operating profit of 96.9 billion yen ($780.8 million), which is significantly higher than the average estimate of 73.3 billion yen ($600 million), put forth by 18 analysts polled by Reuters.

Sony, in recent times, has been looking to reshape its business by focusing less on its consumer electronics division, which has been losing money for successive quarters. The CEO of Sony Corp, Mr. Kazuo Hirai, has of late, looked to focus the company’s attention on components like image sensors, which are amongst the strongest selling products for the company currently. The company’s devices business, which includes image sensors, reported a 164 percent YoY increase in its first-quarter operating income, which came to around 30.3 billion yen ($246 million). The company’s video games business also contributed handsomely to its quarterly earnings, having seen its operating income rise as much as 351 percent to 19.5 billion yen ($158 million) on the back of strong sales of PS4 gaming titles, as well as insurance payments received because of earlier losses accrued through the infamous attack on its network services last year.

It wasn’t however, all good news for Sony, as its mobile division continued to be in the red, and reported a loss of 22.9 billion yen ($186 million) for the quarter ended June 2015. The company also released a gloomy outlook for its mobile division for the remainder of the year, as it revised its full-year guidance downwards. The company now says that it expects an operating loss of 60 billion yen ($486 million) in FY2016, which is over 50 percent higher than the 39 billion yen ($320 million) guidance it issued in April this year. Sony, in June, had announced its first public offering in over twenty-five years, following which, the company’s stock lost 8 percent at the Tokyo stock exchange in a single trading session, amidst fears of stock dilution. The stock prices have recovered since that day though, in light of the expected robust results, and currently, the company’s stock is valued at around twice what it was worth at this time last year.