Sony Group Corp said it is to list its financial arm in October next year, preparing for a major capital infusion after the media conglomerate cut the forecast for its core gaming division.
The company revealed plans for the partial sale after reporting earnings and revising its forecasts for the fiscal year through next month. The move to take Sony’s financial group public is to reverse a US$3.7 billion take-private deal concluded in 2020.
Sony trimmed its revenue forecast after sales of its flagship PlayStation 5 (PS5) came in roughly 1 million units lower than projected in the fourth quarter of last year, at 8.2 million consoles. The company also said it expects to sell 21 million units for the fiscal year, down from the previous forecast for 25 million units.
Photo: AFP
“Looking ahead, PS5 will enter the latter stage of its life cycle,” Sony senior vice president Naomi Matsuoka said. “As such, we will put more emphasis on the balance between profitability and sales. For this reason, we expect the annual sales pace of PS5 hardware will start falling from the next fiscal year.”
The Japanese firm now expects ￥12.3 trillion (US$81.7 billion) in sales for the year, down from ￥12.4 trillion previously. It reported revenue of ￥3.75 trillion and operating profit of ￥463.3 billion in the quarter ended December, in line with average analyst estimates.
“The result showed Sony spent a lot on promotions to sell the PS5, as the unit’s profitability deteriorated, but the number of units it shipped during the quarter was much weaker than expected,” Morningstar research director Kazunori Ito said.
The disappointing hardware sales came despite a strong quarter for software. Released in October last year as a PS5 exclusive, Marvel’s Spider-Man 2 sold 2.5 million copies in its first 24 hours, making it the fastest-selling debut from Sony’s in-house studios. It lifted expectations, along with Sony’s record number of users on the PlayStation network in December, that the PS5 was gaining momentum after years of limited supply.
Analysts remain cautious about Sony’s goal of selling more than 25 million PS5 units this fiscal year. The company released an updated edition of the hardware in October, making it more compact and power-efficient.
Key for the revenue-driving games division is sustaining momentum for the US$499 machine. On the market since late 2020, the PS5 has had a difficult time reaching Sony’s audience as production issues and COVID-19 pandemic-related shipping bottlenecks limited its supply for years.
Rivals Nintendo Co and Microsoft Corp are expected to release new hardware in time for the holiday season, raising the level of competition.
Sony might need to reshape its strategy in India, after a planned merger between its India unit and local media outfit Zee Entertainment Enterprises Ltd reached an impasse due to disagreement over leadership. The Zee deal was the centerpiece to the Japanese firm’s increased push into a market of 1.4 billion people, and investors would look for indications of Sony’s latest thinking on the matter.
UNPRECEDENTED PACE: Micron Technology has announced plans to expand manufacturing capabilities with the acquisition of a new chip plant in Miaoli Micron Technology Inc unveiled a newly acquired chip plant in Miaoli County yesterday, as the company expands capacity to meet growing demand for advanced DRAM chips, including high-bandwidth memory chips amid the artificial intelligence boom. The plant in Miaoli County’s Tongluo Township (銅鑼), which Micron acquired from Powerchip Semiconductor Manufacturing Corp (力積電) for US$1.8 billion, is expected to make a sizeable capacity contribution to the company from fiscal 2028, the company said in a statement. It would be an extended production site of Micron’s large-scale manufacturing hub in Taichung, the company said. As the global semiconductor industry is racing to reach US$1 trillion
A man walks past real-estate advertisements outside a house in Taipei yesterday. The central bank yesterday said it plans to establish an “Inflation-at-Risk” gauge as a supplementary tool for observing inflation, as policymakers express wish to communicate more effectively with the public when making inflation forecasts.
ABOVE LEGAL REQUIREMENT: The Ministry of Economic Affairs is prepared if LNG supply is disrupted, with more than the legal requirement of 11 days of inventory Taiwan has largely secured liquefied natural gas (LNG) supplies through May and arranged about half of June’s supply, Minister of Economic Affairs Kung Ming-hsin (龔明鑫) said yesterday. Since the Middle East conflict began on Feb. 28, Taiwan’s LNG inventories have remained more than 12 days, exceeding the legal requirement of 11 days, indicating no major supply concerns for domestic gas and electricity, Kung said at a meeting of the legislature’s Economics Committee in Taipei. The ministry aims to increase the figure to 14 days by the end of next year, he said. While one or two LNG or crude oil shipments for May
Memory chip stocks extended their losses yesterday after Alphabet Inc’s Google publicized research that could allow more efficient use of the storage needed for artificial intelligence (AI) development. SK Hynix Inc and Samsung Electronics Co, South Korean leaders in the market, fell more than 6 percent and about 5 percent respectively in Seoul. In the US, Micron Technology Inc, Western Digital Corp and Sandisk Corp slid more than 2 percent in pre-market trading, after they all closed lower on Wednesday. Memory companies have been on a tear in recent months as the rapid development of AI infrastructure triggered a spike in chip
RSS