Sony’s overall July-September 2016 sales and operating income declined by nearly half year-on-year with a 48% drop to $453M, driven by a deterioration of operating results in the semiconductors and components department and an increase in the value of Japanese Yen. But notably, this plunge was offset by a $32M quarterly profit in the Sony Pictures department.
Overall sales and operating revenue for the conglomerate, led by CEO Kaz Hirai, fell 10.8% for the quarter to $16.72B year-on-year, mainly due to the impact of foreign exchange rates but on a constant currency basis, sales were essentially flat year-on-year.
Sony Pictures, however, saw a 4.6% year-on-year increase in Japanese Yen (a 25% increase on U.S. dollar basis) to $1.9B primarily due to higher theatrical revenues from films released that quarter including Ghostbusters, Sausage Party and Don’t Breathe. The Ghostbusters reboot earned $229M worldwide while Sausage Party and Don’t Breathe took $136.8M and $151.4M respectively.
Last year in the same quarter, Sony’s Pixels didn’t meet its high expectations taking $244.8M worldwide and Hotel Transylvania 2, which became a big hit for the company last year posting a robust $473.2M worldwide but only opened near the end of the quarter last year.
Sales in TV productions increased significantly due to higher subscription video-on-demand licensing revenues for The Crown and Baz Lurhmann’s music-driven drama The Get Down. Higher ad and subscription revenues across India, Europe and Latin America were major drivers for media sales for the company.
Sony’s games division saw sales decrease by 11.3% year-on-year, with a operating income loss of $188M. This, said the company, was primarily due to the effects of the price reduction for the PlayStation 4 hardware as well as a decrease in PlayStation 3 software sales, partially offset by PS4 hardware cost reductions and sales. Foreign exchange rate fluctuations also hit the division this quarter.
On Monday, Sony Corp. announced the finalization of the sale of its underperforming battery business to electronics component maker Murata Manufacturing, which supplies smartphone parts to companies such as Apple. Sony sold that part of the business for $167M.
