Sony Annual Profits Halved as Film Division Loses $719 Million

Ghostbusters 3
Courtesy of Sony

Japanese electronics and entertainment group Sony revealed net profits Friday of $660 million (JPY73.3 billion) for the 2016-2017 financial year, a 50% reduction from the previous year precipitated by heavy losses in its pictures division.

The division, which encompasses Sony Pictures Entertainment and other film and TV content operations, accounted for a loss of $719 million (JPY80.3 billion) for the financial year running from April 2016 to March 2017.

The results are in line with recent information put out by the company. Last week, Sony revised upwards its own forecast of the 2016-17 results. It left projected revenues unchanged at JPY7.6 trillion, but increased its estimate of net profits to JPY73 billion. That was up from the previous profit forecast in February, which was for a net result of JPY26 billion, but still a decrease compared with the 2015-16 year, in which the company made JPY148 billion.

The group’s nine-month results, published in February, revealed a $913-million loss in the pictures division, most of which related to a massive $962-million write-down of goodwill. That pushed the nine-month group results to a $169-million loss. The write-down is again included in the full year figures.

Currency fluctuations also affected the results. Revenues in the pictures division decreased 4% year-on-year to JPY903 billion, but increased by 5% in dollar terms to $8.06 billion.

The increase in sales on a dollar basis was primarily due to higher sales for television productions and media networks, including higher subscription video-on-demand licensing revenues. The Sony Pictures Television unit had a strong year with a big syndication sale for its ABC comedy “The Goldbergs” and rapid growth in its U.K. and local-language production operations, particularly in Latin America.

The increase in sales for media networks was due to higher advertising and subscription revenues mainly in India, Latin America and the U.S.

“The operating results for the Pictures segment were also negatively impacted by higher programming and marketing expenses for Media Networks, as well as higher theatrical marketing expenses for motion pictures,” Sony said in a filing.

The fourth quarter (January to March 2017) was the pictures division’s best performance of the financial year. It enjoyed $2.66 billion of revenues and $298 million of operating profit.

For the pictures division, Sony is now forecasting a 13% revenue increase (in Japanese yen) to JPY1.02 trillion in the 2017-18 financial year. Without the weight of the write-down, the division’s operating profits are forecast to rebound to $350 million (JPY39 billion,) a figure almost identical to the 2015-16 financial year outcome.

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  1. Ryan Thies says:

    So this year- right as a Writers’ Strike looms- they decide to use an accounting trick to “lose” $962m? And next year “Without the weight of the write-down” they will go right back to their normal profits? Interesting,

  2. Matt says:

    You just know they are riding on Spider-Man: Homecoming, but it won’t save them from The Emoji Movie! 🤣

  3. Rachel says:

    And this year doesn’t look to be any better. They better be praying to God that this Spider-Man works and sticks because they have nothing else, except for maybe Bond, which is in limbo. Hopefully those producers go elsewhere. Sony Pictures is a horrible company that doesn’t value employees or creatives and we have the emails to prove it. They get what they deserve.

  4. Ben says:

    I wonder if Tom Rothman still wants to talk about how well the Ghostbusters reboot film did and how Sony is “planning a sequel”. Yeah, the sound of crickets..

  5. CJB says:

    If they stopped with the crappy remakes it might help!

    • AmandaSue2 says:

      Did they really think an all female cast…for the sake of being FEMALE, was a good idea? Gawd, the first Ghostbusters was questionable. Maybe someone should remake “A Dog’s Purpose” with cats…NOOOO, please don’t tell me it’s a consideration from some Hollywood genius! Hey Sony, perhaps some new and creative ideas would be helpful…..

  6. Guy says:

    And yet again, Sony Pictures Television is leading the company! Great team that not only knows what they are doing year after year but is doing it with smart programming, diversity and all built on great relationships.

  7. WingsofCrystal says:

    Start acting like a business instead of a Social Justice Warrior and you might turn a profit.

  8. Bas says:

    Sony should sell 50% of Sony Pictures it will bring in alot of cash.

  9. Tom Garland says:

    As far as I know Annual earnings has not yet been made public and won’t for at least 72 hours, where do you have this information from? Please provide source.

  10. Mayor Quimby says:

    I wonder how much of that loss was contributed from Ghostbusters. It will forever be remembered as one of the most pointless and costliest “relaunch” attempts, and a colossal failure.

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