Sony said on Wednesday that its annual net profit had dropped 36.5% due to declining gaming and electronics revenues, and warned of a difficult year due to the coronavirus pandemic.
While the demand for game downloads increased during the global blockade of the pandemic, it was not enough to offset the negative effects of the international crisis, including a drop in manufacturing, cancellations of events music and movie closings.
Japanese electronics companies told me The group's net profit reached JPY 582.2 billion (approximately Rs. 40,980 crore) for the year ending in March, without taking into account the unique financial gains recorded the previous year.
Operating profit fell 5.5% to 845 billion yen (about 59,500 crore rupees), sales fell 4.7% to 8.3 trillion yen (about 5.84 crores rupees), and sales in the financial markets have also reduced the book value of Sony's holdings, the group said.
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It suffered "significant declines" in sales of electronics, as well as gaming and networking activities despite strong demand for image sensors used in cell phone cameras.
The PlayStation 4 console is in its seventh year and its successor will be launched in late 2020, leaving users inclined to wait for the PS5.
Sales of electronics have been affected by the coronavirus epidemic, which has forced factories to shut down production and affect retail sales, the company said.
Game downloads have increased, but music industry revenues have been affected when the pandemic forced the cancellation of events.
And while the demand for image sensors was strong, the virus affected the company's production, as well as the sales of its smartphone image sensors manufactured by other companies. in China.
Revenues from the film managed to increase thanks to Spider-Man: away from home and other successes, but the picture is blurred.
PS5 on the way for Christmas
CFO Hiroki Totoki told reporters that the impact of the coronavirus is being felt at different speeds in different parts of the business.
"The electronic products and solutions segment has been affected from the start, but hopefully it will expand to other areas. It will take longer to see a big impact in the segment film, but we fear the impact will last a long time, "he warned. .
He said there were positives, with growing demand for game downloads and its network service, which allows customers to play online with others and store games and data .
And he said the PS5 was on its way despite the global pandemic.
"There have been restrictions on certain control and production operations due to the remote work of employees and restrictions on overseas travel, but we have taken the necessary measures and are preparing to launch sales at during the last shopping season. of the year, "he said. .
Hideki Yasuda, an analyst at the Ace Research Institute in Tokyo, said that Sony faced a mix of positive and negative factors during the pandemic.
"The epidemic has affected the strong sales of its electronic products and cinema films, while affecting production lines," he told AFP before the results were published.
"Image sensor sales remain solid, which drives Sony's performance. Demand for image sensors is expected to continue to grow as high-quality multi-lens smartphones become more and more popular. " , he added, also noting the growing demand for game downloads.
Sony has not released earnings forecasts for the coming year, saying the business uncertainty caused by the pandemic does not provide reasonable projections.
But the consolidated operating profit for the current year until March 2021 "is currently estimated to be at least 30% lower than the level achieved in the previous financial year", he warned.
Nintendo announced a jump in annual sales and profits last week, fueled by demand for its console and popular Switch titles, including the box office hit "Animal Crossing".
Net profit increased 33.3% to 258.6 billion yen (about 18.2 billion rupees) in the fiscal year ended March with sales of 1.3 billion yen (91 , 48 crores lakh), an increase of 9.0%.