For the year through March 2027, the Tokyo-based company expects an operating profit of ¥1.6 trillion, about an 11% increase. Sony improved profitability in the fiscal year just concluded, with its music and smartphone image-sensor businesses making the biggest contributions to growth.
Sony said it plans to cancel 3% of its shares on May 29, helping take some of the pressure off after its Tokyo-traded stock declined more than 20% this year due to pressure from surging component costs. The company also said that its PlayStation 5 sales plans for the year will be contingent on its ability to procure reasonably priced memory for the flagship console.
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The company is in the midst of an overhaul, casting off unprofitable hardware businesses and fixing its focus on expanding IP-led divisions. It’s close to securing a nearly $4 billion deal for a music catalogue that includes the works of Justin Bieber and Neil Young, while earlier this year it surrendered majority control of its TV business to a joint venture with China’s TCL.
Its solid outlook may reassure investors about the pace of Sony’s transition and signal confidence in the company’s resilience to macroeconomic risks. Sony’s shares are down 22% this year as escalating component costs erode margins across the consumer electronics industry.
The core games division combines the burden of escalating hardware costs with promising software margins. The upcoming release of Grand Theft Auto VI in the fall is a likely catalyst to bring in more users to Sony’s entertainment platform and online services.
(Edited by : Juviraj Anchil)
