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Sony logs 18% annual net profit jump, forecast cautious / Photo: Jamie McCarthy - GETTY IMAGES NORTH AMERICA/AFP
NYSE - LSE
Sony logs 18% annual net profit jump, forecast cautious
Japanese entertainment and electronics giant Sony on Wednesday reported an 18 percent jump in annual net profit but issued a cautious forecast for the current financial year.
The firm logged a net profit of 1.14 trillion yen ($7.7 billion) for the 2024-25 financial year, but said it expects that to fall 13 percent to 930 billion yen in 2025-26.
It comes as US President Donald Trump's sweeping, on-and-off tariffs threaten the bottom line of companies worldwide.
"We are responding quickly to the additional US tariffs that have already been implemented and are considering responses to multiple possible future scenarios," the company said in a note alongside its profit forecasts.
"We currently expect to be able to manage the impact on the profitability to approximately 100 billion yen, or less than 10 percent of the operating income forecast."
Sony had in February hiked its annual forecasts, following robust sales of games, music and other products in the October-December holiday shopping season.
Its "video game, music and film businesses are showing steady performance", Rakuten Securities chief analyst Yasuo Imanaka said in a note last month.
For the key gaming sector, "the next fiscal year to March 2026 is also expected to see steady growth", he added.
"Regarding the rise in US tariffs, (Sony) will likely be able to deal with it for the time being as it has stockpiled inventory in the United States," Imanaka said.
"But if high tariffs continue, the longer term impact is unclear," he warned.
Sony in April said it had hiked the price of some PlayStation 5 consoles in select markets, but not the United States, because of "challenging" global economic conditions.
But it has not touched the cost of the higher-priced, higher-spec PS5 Pro console, which hit shelves in November.
Masahiro Wakasugi of Bloomberg Intelligence also said ahead of Wednesday's earnings that "tariffs are likely to be a headwind next year".
But "the music and picture division's earnings can also expand strongly thanks to the high popularity of its streaming music and movies".
Music streaming is a money-spinner for Sony, which has an impressive back catalogue and a current roster that includes artists such as Beyonce and Lil Nas X.
A.Harris--SMC
