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Sony Pictures’ Full-Year Profit Swings To $1.67B; Q4 Snares $84M

Nancy Tartaglione
·4-min read

UPDATE, writethru: For the fiscal year ended March 31, 2022, Sony Pictures Entertainment saw a 172% increase in operating income to 217.4 billion yen ($1.67 billion). Revenues hit 1,239 billion yen ($9.5 billion), up 55% versus the previous year.

The significant jumps were primarily due to higher sales in all categories, with Motion Pictures getting a big boost from Spider-Man: No Way Home which grossed $1.893 billion global through the end of March. It is the No. 6 movie ever at the worldwide box office.

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Sony also cited higher licensing revenues from digital streaming services for new film titles and higher licensing revenues for catalog product. Operating income further saw a hike due to the recording of a 70 billion yen ($537 million) gain from the transfer of GSN Games, a division of Game Show Network, partially offset by the impact of higher marketing expenses for theatrical releases in the Motion Pictures segment.

Note that Sony also provides aggregated dollar results for SPE, which are not reflected in its consolidated financial statements and are not measured in accordance with international financial reporting standards. When looking at those numbers, SPE’s operating income was $1.935 billion for the year, up 156% on the previous term.

In forecasting the 2022 fiscal year through March 31, 2023 from Tokyo today, Sony Corp said sales for Sony Pictures Entertainment are expected to increase 7% on a yen basis. However, the conglomerate is projecting a more than 50% drop in operating income for the division. This is explained by an expected decrease in sales for Motion Pictures as well as the absence of the 70 billion gain from the transfer of GSN Games as included in the 2021 figures.

Sony’s second biggest global theatrical release of 2021 was Venom: Let There Be Carnage at $507M. A threequel was recently confirmed at CinemaCon and on the earnings call, Sony said it was keen to continuing to leverage IP from its stable of Marvel characters, as well as its PlayStation IP. Uncharted was the studio’s third highest-grossing film of the past year with $364M worldwide. On deck for the coming year are such titles as Brad Pitt-starrer Bullet Train and adaptation Kraven The Hunter.

Fourth-quarter sales in the Pictures segment were 312.2 billion yen ($2.4 billion) with operating income at 11 billion yen ($84.4 million). The latter was up significantly after a loss in the similar period last year.

In the Games and Network Services segment, Sony saw a 3% year-on-year sales increase. Operating income was 346.1 billion yen, essentially flat with the previous year due primarily to a decrease in loss resulting from strategic price points for PlayStation5 hardware that were set lower than manufacturing costs, substantially offset by the impact of a decrease in sales of non-first-party titles including add-on content. The number of PlayStation Plus subscribers in the fourth quarter was basically even at 47.4 million.

Sony is forecasting a significant sales increase in the division for fiscal 2022, but operating income is projected to decline to 305 billion yen ($2.3 billion), owing to an expected increase in costs, mainly for game software development at existing studios and the recording of approximately 44 billion yen in expenses associated with acquisitions expected to be completed in the fiscal year ending March 31, 2023.

Music sales for the year are forecast to jump to 1.24 trillion yen ($7.7 billion) with operating income eyed at 230 billion yen ($1.77 billion).

Overall, Sony Corp said revenue was up 10% to 9.92 trillion yen ($76 billion). Operating income saw a jump of 26% on a yen basis to 1.2 trillion yen ($9.2 billion), while net income was down 14%. The increases were largely attributed to the Pictures, Electronics Products & Services and Music segments.

Fourth quarter operating profit at the corporation more than doubled, jumping to 138.6 billion yen ($1.06 billion), compared to a profit of 66.4 billion ($509 million) in the same period a year ago.

Forecasting full-year results for the coming 12 months, Sony expects sales to increase 15% but is looking at a 6% decrease in net income.

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