Sony income dives 48.5% in first qtr.

Despite the success of TriStar’s “Cliffhanger” and Epic Records’ Spin Doctors and Pearl Jam, Sony Corp. reported Thursday a precipitous, 48.5% drop in net income for its first quarter.

Sony reported net income of $ 71,888,000 (19 cents a share) on revenue of $ 7 .7 billion, compared to net income of $ 139,542,000 (35 cents) on revenue of $ 8 .6 billion a year ago. Overall, revenues declined 10.4% for Sony.

Unfavorable exchange rates for the yen, sluggish electronics sales and an inability to generate the next big electronics boom punished the Tokyo-based giant, parent of Columbia and TriStar studios, as well as the Columbia, Epic and associated record labels.

All three factors have dogged Sony for more than a year, but for the quarter ended June 30, entertainment subsidiaries Sony Music and Sony Pictures Entertainment failed to take up the slack for stifling economic conditions and a stumbling electronics arm.

Sony Music reported a 7.2% slide in sales, while Sony Pictures Entertainment suffered a 22.8% hit. Over the previous four quarters, Sony Music and Sony Pictures have consistently posted solid entertainment earnings, offsetting unfavorable economic conditions and deterioration in the electronics segment.

Paul Bricault, an entertainment analyst with Paul Kagan Associates, said the appreciation of the yen against the U.S. dollar cannot be underestimated in evaluating Sony’s bleak profit picture.

Over the last year, the yen has risen 26% against the dollar, including an 18 % zoom between April and June — the first quarter of Sony’s fiscal year. “The explosive rise in the yen helped create a decline in software profits,” Bricault said.

But software profits and losses were not completely obliterated by the yen.

If adjustments were made to compensate for the appreciation of the yen, Sony Music would have hypothetically reported a 10% increase in revenues, while Sony Pictures posted an 8%-9% decrease in revenues, according to Sony Corp. of America spokesman Ken Yoshida.

SPE said comparisons between this year’s figures and last year’s are marred by an unusually strong performance in 1992 (“Basic Instinct,””Hook”).

SPE’s 1993 figures also include portions of the performance from some major releases, including the TriStar Pictures hit “Cliffhanger,” the opening weekend of “Sleepless in Seattle” and the opening two weeks of Columbia Pictures’ domestic debacle “Last Action Hero.”

Sony Music posted strong growth during the quarter, boosted by Spin Doctors and Sade.

In electronics, Sony sales declined 22.4% from a year earlier — a slip ascribed primarily to slumping camcorder sales. In addition, the audio equipment segment dropped 12.1% despite introducing the Minidisc system.

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