Sony Group reported stronger-than-expected December-quarter results, with operating profit rising sharply despite currency volatility and higher memory component costs, as the company’s entertainment and semiconductor businesses supported performance.
The Japanese technology and entertainment conglomerate posted revenue of 3.71 trillion Japanese yen ($23.68 billion) for the quarter, slightly ahead of LSEG SmartEstimates of 3.69 trillion yen.
Operating profit reached 515 billion yen, beating expectations of 468.9 billion yen and marking a 22% increase from a year earlier.
Revenue rose 1% year-on-year.
Sony also raised its full-year outlook, projecting operating profit of 1.54 trillion yen, an increase of 110 billion yen, or 8%, from its prior forecast.
The company lifted its annual revenue estimate by 300 billion yen to 12.3 trillion yen, while maintaining its projection that US tariffs would reduce operating profit by 50 billion yen.
Sony Group’s shares were down 0.63% at the time of writing.
Gaming segment faces cost pressures despite digital momentum
The company attributed its stronger performance to growth in its game, music, and image-sensor businesses.
Sales in Sony’s game and network services division, which includes the PlayStation console brand and remains the company’s largest revenue contributor, totaled 1.613 trillion yen.
That figure declined by 68.7 billion yen from a year earlier.
The gaming segment has benefited from growing digital game purchases and increased adoption of the PlayStation Plus subscription service.
However, hardware shipment growth has remained relatively subdued, and the business is expected to face further challenges from rising component costs.
PlayStation consoles rely on dynamic random access memory (DRAM) chips, which are currently experiencing supply shortages due to surging demand from artificial intelligence and data center operators.
According to market research firm TrendForce, contract prices for conventional DRAM chips are expected to rise between 90% and 95% in the current quarter compared with the previous three months.
Industry executives have indicated that the memory chip shortage could persist through 2027.
Strategic acquisitions and restructuring reshape portfolio
Sony has continued to expand its entertainment footprint through acquisitions and partnerships.
Its music division recently formed an investment partnership with Singapore’s sovereign wealth fund GIC to acquire music catalogs across multiple genres.
In December, Sony agreed to acquire an additional stake in Peanuts Holdings, owner of characters including Snoopy and Charlie Brown, for approximately $460 million.
At the same time, Sony is reshaping its corporate structure to focus more heavily on entertainment content.
The company announced plans in January to form a joint venture with TCL Electronics Holdings, which will end Sony’s majority ownership in its television business.
Sony also spun off its financial services business in October.
Meanwhile, competitor Nintendo maintained its annual sales and earnings forecasts following strong quarterly results, selling 7.0 million Switch 2 consoles during the December quarter, highlighting continued competition in the gaming hardware market.
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