Sony shares jump 9% after profit forecast hike
– On Wednesday morning, shares of Sony Group Corp (6758.T) jumped by 9% after the entertainment giant raised its full-year profit prediction. This was in contrast to the lacklustre forecasts provided by a number of the company’s competitors.
Sony shares jump 9% after profit forecast hike
It was claimed that Sony manufactured more than 6.5 million PlayStation 5 (PS5) systems during the second quarter in advance of the year-end shopping season. This indicates that supply chain snarls that have plagued the games sector are beginning to ease.
In the second quarter, the value of inventory at Sony’s games business increased to 412.5 billion yen, which is equivalent to $2.79 billion. This is an increase from 146.2 billion yen in the first quarter.
According to statements made by Sony’s Chief Financial Officer Hiroki Totoki, the company intends to sell more than 18 million PS5 consoles in 2018.
According to a note sent by a Jefferies analyst named Atul Goyal, “PS5 production limitations have eased,” and “we anticipate (the) gaming segment’s operational leverage is expected to drive upside from next (quarter).”
A boost from changes in exchange rates at divisions like the music industry helped Sony revise its profit prediction. The music business experienced greater sales to streaming services boosted by singers such as Beyonce, whose new album was published in July.
The Japanese conglomerate also improved its forecast for its movies and image sensor divisions, noting the FX boost. However, the company warned that sensor sales were weaker than expected.
As a result of the widening interest rate gap between the United States and Japan, the value of the yen has dropped significantly versus the dollar. When earnings made by Japanese enterprises abroad are repatriated, they often increase due to the weakening of the Japanese yen.
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