As the pandemic PlayStation 5 game console, TV, music and movie demand drove record operating profit in the first quarter, Sony raised its profit forecast on Wednesday.

Operating profit for the quarter ended June 30 increased from 221.7 billion yen (approximately Rs 15,010 crore) in the same period last year to 280.1 billion yen (approximately Rs 18,970 crore), exceeding the expected 207.96 billion yen (approximately Rs. 15,010 crore). 14,000 billion rupees). Analyst, Refinitiv Eikon data show.

It raised its profit forecast for the full year ending March 2022 from 930 billion yen (approximately 629.65 billion rupees) to 980 billion yen (approximately 663.6 billion rupees), which is close to an average of 1 billion yen (approximately 6.8 billion rupees). ) Estimates from 25 analysts.

Sony had predicted that with the relaxation of the coronavirus lockdown, the growing pandemic demand for its equipment and content would weaken, but as a new wave of COVID-19 infection sweeps the world, restrictions remain widespread.

However, the semiconductor shortage has also affected companies such as Apple, which means that it cannot produce enough PlayStation consoles to meet demand.

Sony Chief Financial Officer Hiroki Totoki said at a press conference after Sony’s results that these supply chain restrictions may also affect the production of other consumer electronic devices.

“We use a lot of semiconductors, which is a worrying issue,” Totoki said. “We cannot be complacent,” he added.

Sony said in May that it expects to sell 14.8 million PS5 units this fiscal year. The console was launched in the core market in November 2020, priced at up to US$500 (approximately Rs 37,110 crore) and sold out soon.

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Totoki said that Sony has obtained enough chips to achieve this production goal.

Sony sees gaming consoles as a way to connect its traditional consumer electronics products with its growing content business by encouraging online game downloads and subscription service registrations.

While streamlining its consumer electronics business, Sony is strengthening its entertainment content and distribution business. In December last year, it agreed to acquire AT&T’s animation business Crunchyroll, which has 3 million subscribers worldwide.

In June, it acquired Housemarque, a Finnish game software manufacturer.

Sony has also added movie products on streaming services provided by Disney and Netflix. Due to the pandemic, the theater’s release time was postponed.

However, the company stated that higher production costs have weakened profitability.

In May of this year, the company said it would continue to expand its content business through acquisitions. At that time, the company said it would spend 2 trillion yen in strategic investments over the next three years, including promoting the expansion of subscribers to its games and entertainment services.

In its financial department, Sony announced a one-time loss of 16.8 billion yen (approximately 11.4 billion rupees) in May due to the unauthorized transfer of funds by the Bermuda subsidiary SA Reinsurance.

The company said it has reported the money to local authorities and is working to recover the money.

© Thomson Reuters 2021