Sony Group Corp. raised its outlook for sales and net income for the fiscal year as its PlayStation and entertainment businesses sustained momentum in a sluggish global economy.
The Tokyo-based company said it now expects ¥12.2 trillion ($86 billion) in sales, up from ¥11.5 trillion, and a slightly improved ¥860 billion in net income. It left its full-year operating profit forecast unchanged.
The company reported better-than-expected operating profit in its fiscal first quarter of ¥253 billion, surpassing analyst estimates of ¥242.3 billion. Revenue was ¥2.96 trillion, higher than last year’s ¥2.3 trillion in the same period.
The PlayStation 5, Sony’s most important product, has been the best-selling console in the US this year, in both unit and dollar terms, according to data from Circana. Supply constraints that dogged the games system since its launch in 2020 are now history, and Sony’s working to catch up on lost time — the company still needs to build out its PS5 user base to entice more developers to create specifically for the platform.
Outside its core games division, Sony’s smartphone image sensor business has faced significant headwinds from a stubbornly weak mobile market. Key customer Apple Inc. said at its most recent earnings report that its iPhone is also facing suppressed demand. Some manufacturing yield issues of Sony’s camera sensors also posed a challenge for iPhone 15 production, Bloomberg News previously reported.
Read more: Apple to Keep IPhone Shipments Steady Despite 2023 Turmoil
The Japanese entertainment conglomerate has been beefing up its content offerings in recent years, though the biggest hits of the summer have come from its rivals — from Activision Blizzard Inc.’s Diablo IV to Warner Bros. Pictures’ Barbie, a film that Sony previously held the rights to. Console rival Microsoft Corp.’s takeover of Activision is also nearing conclusion, though the near-term impact of that deal on Sony’s business is likely negligible as the companies have agreed to keep Call of Duty on PlayStation consoles for at least a decade.