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Sony posts best quarterly results in eight years

Sony posts its strongest June quarter since 2007 with profits driven mainly by Sony’s PlayStation 4 software and its camera sensors

Sony has posted profits of $676m for the quarter ending 30 June, up just over 200% compared with a year ago and the highest for the period since 2007.

Operating income was up 39% to $794m, while sales and operating revenue for the quarter was almost unchanged compared with the same period the year before at $14.82bn.

The profits were driven mainly by Sony’s PlayStation 4 (PS4) software and its camera sensors, for which commentators noted the company plans to increase production in anticipation of market demand.

Sony’s imaging products division recorded a 22% increase in operating income compared with the same quarter a year ago of $174m.

The company said this increase was mainly due to the improvement in digital camera product mix reflecting a shift to high value-added models; a year-on-year increase in insurance recoveries related to damages and losses incurred from the floods in Thailand, in the fiscal year ended March 31, 2012; and the positive impact of foreign exchange rates, partially offset by the impact of the decrease in unit sales of digital cameras.

Operating income for Sony’s game and network services was up 351%, compared with 2014 to $160m.

The company said the significant increase was primarily due to PS4 hardware cost reductions, increases in PS4 software sales and PS4 peripheral device unit sales, partially offset by the negative impact of the appreciation of the US dollar, reflecting the high ratio of US dollar-denominated costs and the decrease in PS3 software sales.

Operating income in the quarter also includes $39m of insurance recoveries related to losses incurred from the cyber attack on Sony’s network services – including the PlayStation Network – in the fiscal year ended March 31, 2012.

Banking on camera sensors

Sony’s strong performance has pushed it just past the 50% mark in its share of the worldwide gaming console market, reports Ars Technica.

Over the past quarter, Sony sold three million PlayStation 4 units, while Microsoft sold just 1.4 million Xbox consoles and Nintendo sold just 470,000 units of the Wii U.

Another top earner for Sony was its music division, which saw an income increase of 173% to $256m for quarter.

In contrast to the strong performance of gaming, camera sensors and music, Sony was hit with a decrease in its mobile business, seeing a $188m loss in the quarter.

Sony said a 16% decrease in smartphone unit sales and an increase in restructuring charges were offset primarily by reductions in marketing and other expenses, as well as an improvement in product mix. However, Sony said operating loss increased mainly due to the negative impact of the appreciation of the US dollar.

Based on the last quarter’s poor performance of it mobile business, Sony revised its July full-year loss forecast for the division from $314m to $483m.

Sony’s Xperia Z4 was not well received in Japan, while the Xperia Z3+ sales in Europe were also below company expectations and the Xperia Z4V is not expected to do much better in the US.

Analysts said Sony is banking on camera sensor demands from other smartphone companies.

The company has also recently announced that it is partnering with Tokyo automation startup ZMP to launch a drone business subsidiary.

The joint venture, called Aerosense, combines Sony's core image sensor technology with cloud data processing to provide business customers with data and services, such as land surveying, infrastructure inspection and measurement.

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