Sony's October-December Profit Jumps 25 Percent As Video Game Business Stops Losing Money
TOKYO (AP) -- Sony's PlayStation game business stopped losing money for the first time in six quarters, helping the company to post a 25.2 percent jump in October-December profit.
Solid demand for liquid crystal display TVs and digital cameras also helped results, the Japanese electronics and entertainment company said, which brought the world Walkman portable players and "Spider-Man" movies.
Sony Corp. raised its full year forecast through March 31 only narrowly to 340 billion yen ($3.20 billion) from an earlier 330 billion yen ($3.10 billion), and kept its sales forecast unchanged at 8.980 trillion yen ($84.40 billion).
Tokyo-based Sony also cut its PlayStation 3 fiscal 2007 sales forecast to 9.5 million machines. It had previously expected to sell 11 million PS3 consoles during that period.
Sony sold 4.9 million PS3 machine during the latest quarter for a total of 10.5 million machines sold since it went on sale late 2006.
Japanese rival Nintendo Co. has already sold more than 20 million Wii machines worldwide, wooing newcomers, including women and the elderly, with "Wii Fit," "Wii Sports" and other hit games. Microsoft Corp. has sold 17.7 million of its competing Xbox 360 consoles. Wii and PS3 went on sale about the same time, a year after the launch of the Xbox 360.
The big recovery came in its game unit, which had been losing money on launch costs for the PlayStation 3, the successor to the hit PlayStation 2.
The PlayStation 3 machine itself was still a money-loser but the losses had been trimmed and the machine was expected to start producing profit in the fiscal year starting in April.
Sony's overall profit for the three months ended Dec. 31 climbed to 200.2 billion yen ($1.88 billion) from 159.9 billion yen the same period the previous year.
Quarterly sales gained 9.6 percent from a year earlier to 2.859 trillion yen ($26.87 billion).
Profitability at Sony's core electronics business declined for the quarter as plunging gadget prices offset better sales for Bravia LCD TVs, Vaio personal computers and digital cameras, according to Sony.
Similarly, Japanese rival Matsushita Electric Industrial Co., which makes Panasonic brand products, also reported robust results for three months ended Dec. 31 on strong sales of appliances and digital audiovisual products.
Panasonic's quarterly profit rose 46 percent to 115.2 billion yen ($1.08 billion), and the 4 percent drop in sales on year to 2.34 trillion yen ($22.02 billion) was due to Victor Company of Japan's change in status from subsidiary to affiliate.
Sony's sales and profitability in its movies division both fell because of a dearth of theater hits comparable to "Casino Royale" and "Pursuit of Happyness" of the previous year.
Equity-related income edged up 9 percent on year. Such gains reflect the performance of Sony's cell phone joint venture Sony Ericsson Mobile Communications AB, where handset sales for the quarter soared 18 percent on year to 30.8 million cell phones.
Sony BMG Music Entertainment also fared well with best-selling albums such as Alicia Keys' "As I Am," Celine Dion's "Taking Chances" and Carrie Underwood's "Carnival Ride."
Also boosting investment-related income was Sony's liquid crystal display joint venture with Samsung Electronics Co.
Sony's financial services operations, including an insurer and online bank, racked up a loss because of the recent slide in Tokyo stocks. Share prices have languished after the U.S. subprime mortgage crisis surfaced last year.
Sony shares gained 3.6 percent in Tokyo to 5,220 yen ($49.06). Earnings were announced after trading ended.