Sony posts strong quarterly results
Electronics giant's first full quarter after unveiling reorganization plans is a strong one; gaming sector continues to rake in profits.
Last September, Sony announced a worldwide reorganization plan that included centralizing decision-making and cutting 10,000 jobs by 2008. The move appears to be paying dividends, as the company has today released its generally positive third-quarter results, which included a revised projection on its bottom line for the year. Instead of losing 10 billion yen (almost $86 million) for the year ending March 31, 2006, the company now looks to make 70 billion yen ($601 million) in net profits.
The company's PlayStation 2 and PSP-inclusive Game division played its part in the turnaround, raking in profits more than 50 percent higher than it claimed for last year's third quarter. While PS2 sales suffered, the PSP's first holiday season in worldwide release was sufficiently strong to lift the division's profits from 44.6 billion yen ($383 million) to 67.8 billion yen (almost $583 million). However, the company said those improvements were partially offset by aggressive research and development spending for the PlayStation 3.
One interesting note to come out of the report is that PSP hardware shipments have overtaken PS2 shipments for the first time. The company shipped 6.22 million PSPs for the third quarter, but only 5.36 million PS2s. Game shipments were another story entirely, as the PS2 saw 93 million games shipped (a decrease from the previous year's 109 million) while the PSP ramped up shipments to 14.5 million games. That's up from 1.2 million units for the same quarter the year before, which saw the Japanese launch of the system.
While the company's PlayStation 2 and PSP-inclusive Game division continued to do well, the biggest reasons for the company's revised annual expectations were found elsewhere. Sony credited the rosy outlook to unexpectedly strong performances from its Electronics and Financial Services divisions. Sales on the company's TVs and PCs were particularly strong, the company said. The company's film division, Sony Pictures, was the only one to post a loss for the quarter, ending up 400 million yen ($3.4 million) in the red thanks to box office disappointments like The Legend of Zorro and Zathura.
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