Sales spikes driven by vidgame, TV hardware
The entertainment side was bumpy last quarter, but Sony is still on a roll.
Conglom announced Thursday that profit rose nearly 18% in the third quarter that ended in December and said it will close the fiscal year in March with a profit of more than $600 million, instead of a previously anticipated loss.
Spikes were driven by vidgame and TV hardware.
But results at Sony Entertainment, which includes homevid, pics and TV production/distribution, were essentially flat, with sales down 0.4% to $1.7 billion. Company swung to a slight loss of $3.5 million from a profit of $159 million a year earlier.
Studio has a number of current B.O. successes, including last weekend’s top grosser, “Underworld: Evolution,” as well as “Fun With Dick & Jane” and, to some extent, “Capote.”
Games sales increased an impressive 48%, and profits shot up 52%, largely because of the sale of PlayStation Portable devices.
Meanwhile, Sony’s electronics unit saw profits rise 56% thanks chiefly to the sale of new types of televisions such as the flat-screen Bravia.
For the whole company, profits in the quarter came in at ¥168.9 billion ($1.43 billion), an increase of 17.5% from $1.24 billion in the third quarter of the previous year.
Sales jumped more than 10% from $18.1 billion to $20.6 billion. The Japanese firm did benefit from the weak yen.
Comparisons with the third quarter a year ago are skewed because the studio enjoyed a highly successful October-December period in 2004, releasing “Christmas With the Kranks” and “The Grudge” in theaters and “Spider-Man 2” on homevid.
Sony cited the 2005 “underperformance” of “The Legend of Zorro” and “Zathura” in a call with analysts.
It did not address drama in its music division, the joint venture with Bertelsmann’s BMG, but did say sales had dropped less than 1% to $1.5 billion for the quarter — a difficult feat in a tough music market.
Overall, investors were exuberant about the Sony gains, and the company’s stock rose $5.28 to $48.57 in strong afternoon trading.
Howard Stringer took the reins of Sony from former topper Nobuyuki Idei in June, after several quarters of struggle. The former topper of Sony Corp. of America promptly went about remaking the company, particularly its electronics biz, where competition from the two A’s — Asia and Apple — had set it back.
Recently, Sony also announced a cost-cutting plan to shutter the Japanese plant where Walkmans are made.
For the first three quarters of the fiscal year — which began shortly before Stringer took the top job — profits rose 33% compared to the prior year.