Addressing reporters on Wednesday, Sony's Chief Executive Officer, Hiroki Totoki, detailed the company's strategic vision for future growth. He emphasized the critical role of synergy and collaboration across Sony's diverse segments, including animation and music, in delivering "kando" – the Japanese word for emotional engagement – which he identified as the core of Sony's strength and corporate philosophy.
Leveraging Cross-Segment Collaboration for "Kando"
"Building on our momentum and results to date and working with a laser-like focus to realize our long-term Creative Entertainment Vision will be at the core of our corporate strategies moving forward," Totoki stated. He highlighted the robust pipeline within Sony's movies division, featuring upcoming Spider-Man films and biopics centered on the iconic band, The Beatles. Furthermore, Totoki underscored animation as a significant growth driver, particularly through the popular anime streaming platform Crunchyroll.
Record Profits Despite Slight Dip in Overall Sales
Tokyo-based Sony reported a record annual profit of 1.14 trillion yen ($7.8 billion), a substantial increase from the 970.6 billion yen recorded in the previous fiscal year. While profitability surged, annual sales saw a marginal decrease, inching down to 12.957 trillion yen ($88 billion) from 13.020 trillion yen.
Among Sony's extensive business portfolio, the financial segment experienced stagnant revenue. However, both the film division and the imaging and sensor solutions segment demonstrated strong performance.
Navigating International Trade Policies
Sony officials acknowledged the challenges posed by international trade policies, stating that they were actively studying how to respond to tariffs imposed by the U.S. administration. They noted the difficulty in formulating a precise response due to the inherent uncertainties and ongoing changes in trade regulations. Nevertheless, they expressed confidence that the negative impact from U.S. trade policy would be limited to 10% of Sony's operating profit in the current fiscal year through strategic adjustments, including the reallocation of shipments.
Immersive Experiences and Strategic Partnerships
Totoki emphasized Sony's commitment to leveraging its content creation technologies, such as virtual reality and advanced image sensors, to enhance its entertainment offerings and create immersive experiences for consumers. He also highlighted Sony's strong collaborative relationships with various entertainment powerhouses, including Kadokawa, which encompasses publishing, film, and animation, and Bandai Namco, a prominent video game developer.
Fostering Diversity for Creative Potential
Looking internally, Totoki stressed Sony's commitment to promoting the "diversity" of its workforce as a key strategy to unlock and nurture the creative potential of its employees.
Box Office Successes and Strong Music Performance
Several Sony movies achieved significant box office success during the fiscal year ending in March, including "Venom: The Last Dance," featuring the popular Marvel Comics character, and "Bad Boys: Ride or Die," the fourth installment in the action-comedy series starring Will Smith and Martin Lawrence.
Sony's gaming business, anchored by the PlayStation console and its accompanying software, also reported robust results.
The company's music operations, encompassing recordings, streaming services, and music for games, demonstrated resilience. Globally, the top-selling recorded music projects for the fiscal year were SZA’s “SOS Deluxe: LANA,” followed by releases from Beyoncé, Future & Metro Boomin, and Travis Scott. In Japan, Kenshi Yonezu’s “Lost Corner” album led sales, followed by offerings from Stray Kids and Six Tones.
Mixed Results for the January-March Quarter and Future Outlook
For the January-March quarter, Sony reported a profit of 197.7 billion yen ($1.3 billion), a 5% increase from the 189 billion yen recorded in the same quarter of the previous fiscal year. However, sales for the quarter declined by 24% to 2.6 trillion yen ($17.7 billion) from 3.48 trillion yen.
Looking ahead, Sony is forecasting a nearly 13% drop in profit for the fiscal year ending March 2026, projecting 930 billion yen ($6.3 billion) on sales of 11.7 trillion yen ($80 billion), a 2.9% year-on-year decrease.
Despite a dip in stock prices during morning trading in Tokyo, Sony Group Corp. shares rebounded strongly after the financial results were announced, ultimately finishing 3.7% higher.