Japan’s Sony said on Wednesday that first-quarter profit fell sharply due to weakness in its film and financial businesses.

Operating profit fell 31% to 253 billion yen ($1.8 billion, or 149.07 billion rupees) in the April-June period, in line with expectations.

Profits at its film division fell by two-thirds as sales of TV content fell and marketing costs rose as the company released more films in theaters.

The conglomerate, once a consumer electronics giant, has transformed itself to focus more on entertainment, developing movies, music and games. It is also a leading manufacturer of image sensors.

In May, Sony said it was considering spinning off parts of its finance unit, which includes life insurance and banking, as it looks to invest in its entertainment business.

Sony said it expects to sell 25 million PlayStation 5 consoles this fiscal year, which would be a record for a PlayStation device, as supply chain disruptions ease.

Cumulative sales of the game console have exceeded 40 million units.

Nintendo reported last week that it had sold 18.5 million units since the release of The Legend of Zelda: Tears of Kingdom in May, helping to boost sales of its aging Switch console.

The global video game market will return to growth in 2023, thanks to strong sales of consoles such as Sony’s PlayStation 5, game market research firm Newzoo said on Tuesday. Newzoo said it expects industry revenue to grow by 2.6 percent to $187.7 billion (roughly Rs. 15 crore) in 2023. Game console sales are expected to grow by 7.4 percent to reach Rs. 54,231 crore. Gaming revenue will drop 5% in 2022, according to the research firm.

Last month, Sony’s film division delayed the release of a slew of major upcoming films in light of the ongoing strike by writers and actors in Hollywood. The March 29, 2024 release date for Spider-Man: Beyond the Spider-Verse has been cancelled. The “Spider-Man” spin-off “Kraven the Hunter” was originally scheduled to hit theaters on October 6, but has now been pushed back almost a year to August 2024.

© Thomson Reuters 2023


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