The recent, unprecedented depreciation of the Yen currency versus the U.S. dollar clouded the profit picture for the Japanese entertainment company.
Operating profit for Sony Pictures’ fiscal second quarter fell to $202 million from $288 million the year before, a decrease of 30%. The revenue for the quarter that ended on September 30 increased by 3% to $2.44 billion from $2.37 billion.
Film unit profit fell 13% to 27.6 billion yen in yen terms, while sales increased by 29% to 76.8 billion yen.
The significant fluctuation in the exchange rate between the US dollar and the Japanese yen during the preceding year tainted the findings considerably. In recent months, the value of the Japanese yen has plummeted to a 30-year low as the Bank of Japan maintains its ultra-loose monetary policy while to fight inflation, the Federal Reserve quickly increases interest rates. The outcomes were obvious: Sony used an exchange rate of $1 to 114 yen in its second-quarter results report in 2021, but on Tuesday, $1 was worth an average of 148 yen. Sony utilized an average rate of 138.2 yen to represent changes over the quarter in its second-quarter 2022 report.
Sony Corp. released its July-to-September profits at its Tokyo headquarters. The Japanese business credited Sony Pictures’ income increases to both higher theater ticket sales and higher sales of the television license. Gains were also fueled by higher income from the business’s recent acquisition, the anime streaming service Crunchyroll. However, a decline in series deliveries for television programs as well as higher marketing expenses to support current-year theatrical releases weighed on profits. The largest theatrical movie from the company during that time was Brad Pitt’s Bullet Train, which earned $240 million globally but received mixed reviews.
Sony Corp. easily surpassed analysts’ expectations for the quarter at the group level. Contrary to consensus expectations of around 280.7 billion yen, the company recorded an operational profit of 344 billion yen for the quarter from July to September. In response, Sony increased its operating profit estimate from its earlier projection of 1.11 trillion yen to 1.16 trillion yen ($7.8 billion). The firm profited from the resolution of issues with the supply chain that had previously led to shortages of Sony’s bestselling PlayStation 5 systems. During a strong quarter for sales of the iPhone and other devices using Sony’s components, the cheap yen also helped Sony’s image sensor sales.
