Sales Of Sony TV’s Smartphones + Gaming Consoles Up
Revenues increase of 6.1% compared to the same quarter of the previous fiscal year (“year-on-year”). The sales hike was primarily due to the favourable impact of foreign exchange rates, a significant increase in mobile sales including their new smartphones, a significant increase in Sony image sensors, and a significant increase in game & network Services
The increase in these divisions has been offset by a significant decrease in sales in ” All Other, primarily related to Sony’s exit from the PC business, and a significant decrease in sales in the Pictures segment, mainly due to lower Motion Pictures and Television Productions sales” Sony said in Tokyo this afternoon.
Operating income is expected to increase by US $1, 47 Billion dollars.
Operationally ales of Sony smartphones increased 28.7% year-on-year to US3.54 Billion. Operating income increased US$76 million U.S. Sony said that this was primarily due to an improvement in product mix and an increase in smartphone unit sales.
Sales of games consoles and games for the PS4 increased 16.8% year-on-year to US$4.3 Billion.
Sony said that ‘This significant increase was primarily due to an increase in PS4 hardware unit sales, the favourable impact of foreign exchange rates and a significant increase in network services revenue, partially offset by a decrease in PlayStation?3 (“PS3”) hardware and PS3 software sales.
Sales to external customers increased 19.7% year-on-year.
Operating income was $US228 million. The Japanese Company also made allowances for the write-down of PS Vita and PS TV components. This write-down was recorded because the latest forecast of PS TV unit sales was significantly down.
Sales of consumer electronic goods spanning TV’s and sound gear increased 2.3% year-on-year to $US3.416 Billion.
Sony said that the increase was primarily due to the favourable impact of foreign exchange rates and a significant increase in sales of televisions, partially offset by a decrease in audio and video sales. Unit sales of LCD televisions increased mainly due to a significant increase in North America and Europe, partially offset by a significant decrease other Countries. It is not known whether sales increased or decreased in Australia.
Operating income was $US 209 million. Televisions, sales increased 10.1% year-on-year.
Sony said it would post a $170 million operating profit for the year ending March 31, after previously predicting a ?40 billion loss.
Chief Executive Kazuo Hirai and Chief Financial Officer Kenichiro Yoshida have stepped up efforts to cut costs and eliminate unprofitable operations. Last year, Sony sold its personal computer business and separated its TV division into a freestanding but wholly owned company. After a decade of losses, the TV unit is set to post an operating profit of ?13 billion in the year ending March 31, Sony said.
“Our restructuring efforts have taken time, but we are seeing the effects,” said Mr. Yoshida, who took over in April 2014, at a news conference. “The management decision to spin off the PC business last year was a big event for us in terms of changing employees’ mindsets,” Mr. Yoshida said.
The company said Wednesday it would cut a further 1,100 jobs in its mobile division, which has struggled to compete with Apple and Samsung. Since 2008, overall employment at Sony has fallen to 140,900 workers from 180,500.
Sony still faces headwinds in some business areas. Weak smartphones sales have dashed hopes of taking on the industry leaders, and the company is pulling back from markets such as China, where it has been undercut by lower-cost upstarts like Xiaomi. Sony last year shifted its smartphone strategy to concentrate on high-end models for selected markets.
Sony’s camera business is also shrinking. While the company nudged up its outlook for the division’s annual operating profit to ?53 billion from ?52 billion, it said that was largely due to the weak yen, which makes Japanese exports more price-competitive.
“It’s too early to say a strong Sony is back,” said Atsushi Osanai, an associate professor at Waseda Business School, who used to work at Sony. Mr. Osanai said he would currently give all of Sony’s business segments a “B” grade. “What Sony needs to do from now on is focus on selected businesses to achieve an ‘A’ in these subjects,” he said.
While Sony struggles to sell smartphones, it has benefited from booming sales of Apple’s iPhones, which use Sony-made image sensors. Sony announced plans this week to expand sensor manufacturing capacity in Japan, where the weak yen has made manufacturing cheaper.