Sony Surges by $3.3 Billion as James Bond, Adele Boost Earnings

Updated on
  • Shares rose the most in over seven years in Tokyo trading
  • Music and movie earnings helped offset smartphone slump

James Bond and Adele Save Sony's Profit

Sony Corp. gained $3.3 billion of market value after reporting better-than-expected profit with a huge helping hand from Hollywood, music and games last quarter.

The shares climbed 12 percent to 2,836 yen in Tokyo on Monday, the biggest increase since October 2008, compared with a 2 percent advance for the Nikkei 225 Stock Average. Sony’s net income surged to 120.1 billion yen ($989 million) in the December quarter, beating the 91.1 billion yen average of four estimates compiled by Bloomberg.

Sony gave due credit on Friday to both the James Bond film “Spectre” and record-breaking sales of Adele’s “25,” which wasn’t available on streaming services Spotify and Apple Music. Games, its biggest division by sales, sold more PlayStation 4 consoles and software titles to help offset a plunge in sensor orders from smartphone customers such as Apple Inc. and Samsung Electronics Co.

“Results contained a mix of positives and negatives, but were slightly positive on balance,” Mika Nishimura, a Tokyo-based analyst at Credit Suisse Group AG, wrote in a report on Jan. 29. “Positives included brisk results from games, music, and other businesses, and confirmation of steady progress on structural improvements in the mobile segment.”

Mixed Bag

Sony reported third-quarter profit in the mobile business more than doubled from a year ago to 24.1 billion yen, despite a negative impact from the weaker yen. The company cited a shift to high value-ended models and cost reductions.

While Sony kept its full-year forecasts unchanged for the whole company, including operating income of 320 billion yen, it increased projections for games on higher network sales while cutting expectations for the devices unit that produces image sensors.

The chip unit felt the pain of decelerating smartphone demand as markets matured and China slowed. It had a loss of 11.7 billion yen in the quarter after Sony took a 30.6 billion yen impairment on its battery business. The full-year operating income forecast for the business was cut to 39 billion yen from 121 billion yen.

Gaming operating income will be 85 billion yen, about 6 percent more than an October forecast, Sony said. Quarterly operating profit for the business was 40.2 billion yen.