The pandemic’s boost is fading for Sony
but the company’s longer term content-focused strategy still looks likely to pay off.
On Wednesday, the Japanese electronics-and-entertainment giant reported a record net profit for the fiscal year ended in March. The highest-ever earnings from its game division, helped by stay-at-home demand, was the major driver.
Sony has sold 7.8 million of its new PlayStation 5 console since its November release, outpacing its predecessor at the same stage. It could have sold even more if not for supply constraints due to a chip shortage. Operating profit at its game division fell almost 30% year-over-year last quarter. That was partly due to marketing expenses for the PS5 launch and because the console is sold below cost.
But the boost from the Covid-19 pandemic could soon be over. Sony issued a cautious outlook, forecasting a decline in operating income this fiscal year — though the company has usually been conservative in its guidance, according to Jefferies.
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