PlayStation 4 sales and positive foreign exchange rates rescued Sony to a mere 0.5% decrease in sales for the second quarter ended September 30, 2015, with the financial services and mobile communications segments suffering sales declines. The company’s sales decreased by 0.5% compared to the same quarter of the previous fiscal year to 1.89 trillion yen ($22 billion).
Operating income of 88 billion yen ($1.02 billion) was recorded, compared to an operating loss of 85.6 billion yen ($995.2 million) in the same quarter of the previous fiscal year. This significant improvement was attributed to the 176 billion yen ($2.05 billion) impairment of goodwill recorded in the mobile segment in the same quarter of the previous fiscal year.
Gaming sales soar more than 16% thanks to PS4
Sales in the game and network services segment increased 16.5% year-on-year to 360.7 billion yen ($4.19 billion) primarily due to an increase in PS4 software sales as well as the impact of foreign exchange rates, partially offset by a decrease in PlayStation®3 (PS3) software sales. Operating income increased 2.1 billion yen year-on-year to 23.9 billion yen ($278 million) due to the above-mentioned increase in PS4 software sales, partially offset by the negative impact of the appreciation of the U.S. dollar.
Mobile segment suffers 15% sales decline
Sales decreased 15.2% year-on-year to 279.2 billion yen ($3.25 billion) in the mobile communications segment due to a significant decrease in smartphone unit sales resulting from a strategic decision not to pursue scale in order to improve profitability. Operating loss decreased 150 billion yen year-on-year to 20.6 billion yen ($239.5 million) due to the negative impact of the appreciation of the U.S. dollar, reflecting the high ratio of U.S. dollar-denominated costs, and an increase in restructuring charges.
The negative impact of the above-mentioned decrease in smartphone unit sales was offset by an improvement in product mix reflecting a shift to high value-added models, as well as reductions in costs including marketing, research and development expenses.
Digital cameras see surprising sales boost
The digital imaging segment saw sales increase by 4.1% year-on-year to 186 billion yen ($2.16 billion), primarily due to an improvement in product mix of digital cameras reflecting a shift to high value-added models and the impact of foreign exchange rates, partially offset by a decrease in unit sales of digital cameras reflecting a contraction of the market.
Operating income increased 5.8 billion yen year-on-year to 25.9 billion yen ($301 million) due to the improvement in digital camera product mix and cost reductions.
Home entertainment hurt from market contraction
The home entertainment segment suffered a sales decline of 0.2% year-on-year to 289.1 billion yen ($3.36 million). Sales were essentially flat primarily due to a decrease in home audio and video unit sales reflecting a contraction of the market, offset by an improvement in product mix of LCD televisions reflecting a shift to high value-added models and the impact of foreign exchange rates.
Operating income increased 6.7 billion yen year-on-year to 15.8 billion yen ($183.5 million) due to cost reductions and an improvement in product mix, partially offset by the negative impact of the appreciation of the U.S. dollar, reflecting the high ratio of U.S. dollar-denominated costs.
In the television category, sales increased 1.6% year-on-year to 203 billion yen ($2.36 billion) with an improvement in product mix reflecting a shift to high value-added models and the impact of foreign exchange rates, partially offset by a decrease in LCD television unit sales resulting from a strategic decision not to pursue scale in order to improve profitability.
This story first appeared in Appliance Retailer.