Faltering film unit slashes Sony profits
EmptySocked with a $77 million loss at its film division, Sony on Tuesday said its overall profit was cut almost in half in the fiscal first quarter.
The quarterly comparison was a tough one for Sony, whose year-ago earnings were buoyed by "Spider-Man 3," a strong performance by the company's electronics division and a robust yen.
Sony reported a 47% decline in profit to ¥35 billion ($330 million) for the three months ended June 30 and lowered its earnings forecast for the full year.
The red ink at Sony Pictures Entertainment compared with a year-earlier profit of $43 million.
Overall sales were flat at almost 2 trillion yen ($18.5 billion).
SPE revenue was off by a third, amid lackluster boxoffice beyond "You Don't Mess With the Zohan."
More positively, Sony's games division swung to a profit in the latest quarter.
The games division saw profit of ¥5.4 billion ($51 million), thanks to lower manufacturing costs and higher sales for the PS3. The PS3 and PSP both saw growth of about 50% in hardware sales, and the PS3 finally outsold the PS2.
In a conference call, Sony Corp. of America CFO Robert Wiesenthal reported a "fairly good" launch of a movie-and-TV downloads service for PlayStation users, with sales going better than rentals to date.
Execs touted also touted future prospects for its music operations at a time when many game and TV hits are music-driven.
But Sony BMG recorded a $42 million loss for Sony, as physical sales fell faster than music downloads increased. A year earlier, the unit posted a profit of $31 million.
"We see music driving value everywhere," Wiesenthal said.
Sony reportedly is in talks to buy the 50% stake it does not own in Sony BMG Music Entertainment from Germany's Bertelsmann for more than 100 billion yen ($931 millon).
Gavin J. Blair reported from Tokyo; Georg Szalai reported from New York.