Sony Film Unit Posts $366 Million Quarterly Profit

Profits at Sony Corp. hit $1.75 billion, up 15 percent on the same quarter last year. The film division was boosted by a strong box office from 'Spider-Man: Far From Home' and 'Once Upon a Time in Hollywood'.

Sony Pictures posted a 67 percent jump in profit to $366 million for the July to September quarter, Sony Corp. announced in Tokyo on Wednesday.

The film unit was boosted by the release during the quarter of Spider-Man: Far from Home, which took more than $1.1 billion globally, and Quentin Tarantino's Once Upon a Time in Hollywood, which logged nearly $360 million.

Revenue was up 12 percent in the same period last year. The film unit posted profits of $211 million in the same quarter last year, helped by strong global earnings from Hotel Transylvania 3: Summer Vacation and The Equalizer 2.

For movies alone, revenue was up from $980 million in the same quarter in 2018 to $1.306 billion, while revenue from television production was down from $614 million to $574 million.

Sony's full-year revenue forecast for the film division is down slightly at ￥1,030 billion ($9.59 billion at current exchange rates) but it raised its operating profit forecast to ￥70 billion ($651 million).

Operating income at the gaming division was down about 25 percent to $605 million (￥65 billion), on sales down to $4.24 billion as the announcement of the new PlayStation 5 (PS5) console, due next year, hit hardware and software sales, and foreign exchange rates hurt results.

Full-year sales and operating income forecasts for the profitable gaming business were lowered.

On Tuesday, Sony announced that its U.S. PlayStation Vue television service will shutter in January 2020 after struggling to turn a profit since its launch in 2015, and failing to find a buyer. 

"Unfortunately, the highly competitive Pay TV industry, with expensive content and network deals, has been slower to change than we expected. Because of this, we have decided to remain focused on our core gaming business," said Sony Interactive Entertainment deputy president John Kodera in a statement. "PlayStation fans can continue to access movie and TV content through the PlayStation Store on PS4 and via our partnerships with top entertainment apps."

Profits at the music division were up to $350 million (￥37.5 billion), as revenues streaming revenue continued to grow and Sony made more money from its EMI publishing business, which it fully acquired last year. It raised its full-year sales and operating income forecast at the division.

Overall revenue at Sony Corp. was up slightly in dollar terms at $19.75 billion, compared with the same period last year, with earnings up 9 percent to $1.75 billion.

The entertainment to electronics conglomerate is planning to expand its profitable semiconductor/image sensor business, which makes chips for smartphones and other devices, by investing around $920 million (￥100 billion) in a new factory in Nagasaki, according to domestic media reports. Sony last month rejected a call from activist investor Daniel Loeb and his Third Point hedge fund to spin off the semiconductor business, which has about a 50 percent global market share in the sector.  

The division posted sales up 22 percent at $29 billion despite a negative foreign exchange impact and operating income up by around half at $711 million.

The forecast for full-year profits at Sony Corp. was raised by 8 percent to ¥540 billion, $5.03 billion at current rates.

Sony stock closed down 1 percent at ￥6,365 ($58.50) in Tokyo trading before the results were announced, while the Nikkei 225 index was down 0.5 percent on the day. Sony stock is up around 10 percent on this time last year