Operating Income Rises at Sony Pictures

Despite a reduction in revenues, operating income at Sony Pictures Entertainment in Q1 rose to $233 million.

The division of the Japanese conglomerate posted revenues of 175.1 billion yen ($1.65 billion), down 6 percent (4 percent on a U.S. currency basis), with theatrical revenues and ad revenues at the media networks down due to COVID-19. The segment did report higher U.S. television product revenues.

For the full 2020 fiscal year, Sony Pictures is forecasting revenues will drop by 25 percent.

“Although we have resumed filming in some countries, the severe environment in motion pictures and television productions is continuing,” the company said. “If we can restart production, we think we can recover our position in the television productions area relatively quickly because demand for content from digital distribution services is extremely high and we think we can leverage our advantage as a major independent studio. As for theatrical, theaters are either closed or admittance is limited, and we expect the release calendar to be crowded when they do reopen. Since motion pictures generate profit over multiple years, starting with theatrical release, the impact on our financial results of not being able to release them is expected to last two to three years. On the other hand, digital sales of product we released theatrically in the past are strong.”

“For Sony, the importance of theatrical releases is not expected to change going forward, but in order to maximize the long-term value of our product, we will select the optimal distribution channel for our product based on the nature, scale and timing of the product.”

At Sony Corporation, overall revenues were up 2 percent, with operating income down by just 1 percent and net income up 53 percent.