Sony shares post biggest jump in three weeks following surprise profit driven by PlayStation games

Sony has seen its revenue rise the most in three weeks after its resurgent games division helped the Japanese conglomerate blow past quarterly results expectations, vindicating Chief Executive Officer Kazuo Hirai’s growing focus on media and entertainment. Shares jumped as much as 3.5 per cent to 3,397 yen (Sh3,347), the biggest jump on an intraday basis since July 11.

Sony, which in years past has scaled back in businesses from phones to TVs, posted a surprise profit for the June quarter, Bloomberg reports. It more than doubled operating income from the sale of its PlayStation game consoles and software.

Sony is looking to cement its lead over Microsoft Corp. and Nintendo Co. by launching a virtual-reality headset in October in the U.S., as well as a souped-up version of the Playstation 4 (PS4), its latest console, potentially before the end of the year. The twin gadgets mark Hirai’s long-term effort to dominate the industry with the PlayStation division, which he helped launch in 1994 before being tapped as CEO.

“Nothing short of fantastic, especially given that the market has been expecting a loss,” Amir Anvarzadeh, Singapore-based Head of Japanese Equity Sales at BGC Partners Inc., wrote in an e-mail. “The big takeaway was the games business. Profit there more than doubled and that’s even before PlayStation VR launch in October, which will be a huge shot in the arm for hardware sales.”

Sony reported net income of 21.2 billion yen (Sh21 billion) in the quarter through June, compared with the average analysts’ expectation for a 39 billion-yen (Sh38 billion) loss. The firm maintained its forecast for annual profit of 80 billion yen. The strength in games is helping investors look past the impact from the Kumamoto earthquakes, which shut the primary manufacturing site for image sensors that power digital cameras. On Friday, Sony lowered its estimate for operating losses from the earthquakes to 80 billion yen for this fiscal year, from 115 billion yen as recovery efforts wrapped up a month earlier than expected.

While Sony managed to post a rare profit in phones, by dint of reducing its mid-range line-up and retreating from unprofitable markets, it was the games unit that impressed stakeholders.

Quarterly profit from that division more than doubled to 44 billion yen (Sh43 billion). It sold 3.5 million PS4 consoles in the quarter, and kept its annual outlook for sales unchanged at 20 million units. Last month, Sony raised revenue and margin targets for the PlayStation business next fiscal year, as it expects a push into music and video streaming on its gaming network to boost user growth.

Previous Global oil prices will continue to fall, experts say
Next Boosting competition in African markets can enhance growth, lift half a million people out of poverty says World Bank

You might also like

News 0 Comments

Unions warn against early campaigns

Trade unions have warned politicians against early campaigns saying it will hurt the economy. Both the Central Organization of Trade Union (COTU) and Kenya National Union of Teachers (KNUT) have

Latest 0 Comments

IEBC: No technical hitches in 2017 polls

The Independent Electoral and Boundaries Commission has assured the country that the technology set to be used in the 2017 polls will not develop any hitch during transmission of results

Latest 0 Comments

News headlines- Ruling on doctors’ union officials jail sentence on Friday 3rd February 2016

Ruling on doctors’ union officials jail sentence on Friday Striking doctors’ union officials will know their fate on Friday when the court makes a ruling on their suspended one-month jail sentence. Employment and


No Comments Yet!

You can be first to comment this post!

Leave a Reply