Spider-Man smash and Seinfeld licensing boosts profit for Sony

Japanese company lifts its full-year forecast after bumper quarter

Japan's Sony Group Corp raised its full-year profit forecast by 15 per cent on Wednesday after posting estimate-smashing quarterly earnings, propelled by the success of Spider-Man: No Way Home, which has become the sixth-highest grossing movie.

Operating profit at its pictures business jumped by more than seven-fold to 149.4 billion yen (€1.15 billion) in its fiscal third quarter ended December as the unit’s revenue more than doubled.

It now expects the business to post a profit of 205 billion yen in the current fiscal year as the superhero film, released in December, grossed more than $1.7 billion (€1.5 billion) worldwide despite the spread of the Omicron coronavirus variant.

The segment was also boosted by receipts from the Venom: Let There Be Carnage movie and licensing of comedy Seinfeld along with the sale of mobile games business GSN Games.

Sony Pictures Television controls the distribution of Seinfeld, which ran from 1989 to 1998. In 2019, it cut a deal for the global rights with Netflix that saw the series added to the streamer's service from October 2021.

Overall quarterly operating profit at Sony – a conglomerate spanning areas such as entertainment, sensors and financial services – was 465.2 billion yen, compared with an estimated average profit of 351.6 billion yen from nine analysts surveyed by Refinitiv.

Sony increased its full-year profit forecast to 1.2 trillion yen from 1.04 trillion yen. That prediction is higher than an average 1.09 trillion yen profit forecast from 24 analysts, Refinitiv data showed.

Gaming performance

The company’s main gaming segment, focused on PlayStation, also posted a rise in profit, with sales of 3.9 million PS5 units in the third quarter, but hardware supply was hampered by component shortages.

Sony cut its full-year PS5 sales forecast to 11.5 million units from 14.8 million units previously in response.

The group is looking to retain its industry position by riding two of the technology sector’s most disruptive trends, the growth of immersive, online gaming and the transition to electric and autonomous vehicles.

On Tuesday, the company announced it will buy Bungie, the original creator of the Halo videogame, for $3.6 billion.

That comes after XBox console maker Microsoft Corp said last month it will purchas Call of Duty maker Activision Blizzard for $69 billion.

Bungie is experienced in developing long-running online titles, as opposed to Sony's expertise in single-player games. The group aims to launch more than 10 live service titles by March 2026, chief financial officer Hiroki Totoki told a news conference.

The Japanese consumer tech company may also branch out into electric vehicles (EVs), with chief executive Kenichiro Yoshida unveiling a new EV prototype and announcing the creation of a mobility business at a tech trade show in Las Vegas last month.

– Reuters