Sony Group on Wednesday announced that it expects its full-year in service profit to rise 26% to 1.2 trillion yen ($10.5 billion), an upward revision from its earlier forecast for a 9%, or 1 trillion yen, amplify in operating profit.
The Japanese corporation also reported an operating profit of 1 trillion yen for the nine months ended December, up 19.7% from the same period last year, thanks to robust sales from its motion picture and music streaming businesses.
Sony reported profits of 7.6 trillion yen, up 13%, thanks to strong sales from its movie business, which was helped by the release of "Spider-Man: No way home" in December. Sony's net profit fell 20% to 771 billion yen, as the effect of tax cuts in the previous fiscal year dissipated.
The brisk sales from Sony's music streaming services help lift its operating profit. Sony reported a capital gain of 65 billion yen from the sale of mobile gaming subsidiary GSN Games, which also contributed to its operating profit.
On the other hand, its mainstay gaming industry is slowing as COVID-driven demand wanes and the ongoing chip shortage limits supplies of its PlayStation 5. From April to September, Sony sold 5.6 million PS5s, just 38% of its sales target for this fiscal year. Sony earns nearly 30% of its revenue from gaming.
Competition in the gaming section is intensifying as Sony and Microsoft snap up smaller rivals, hoping to gain an edge in the hunt for new customers. On Jan. 18, Microsoft plans to buy Activision Blizzard for $69 billion. The U.S. software developer is behind the hit game World of Warcraft.
Sony's shares plummeted 13% on Jan. 19 as investors concerned the stiffer competition could weigh on its earnings in the gaming business.
Sony strike back on Monday by buying Bungie, the U.S. game maker behind both Halo and Destiny, for $3.6 billion.
Shares in Sony on Wednesday rose 4% to 13,315 yen at one point during morning trade, as investors react to the company's latest investment. The share price is 13% higher than on Jan. 27 when it hit a three-month low.