Sony's software strength offsets flat hardware sales

Sony's Game & Network Services rose 70 per cent in the third quarter, a significant increase in software sales offsetting a decline in hardware revenue.

In the quarter ended December 31, 2017, Sony Corp.'s games division earned ¥718 billion ($6.5b) in revenue, up 16.2 per cent year-on-year. These gains were almost entirely down to the performance of software, the sales of which rose almost 71 per cent to each ¥300.4 billion ($2.7b) for the quarter.

Shipments of the PlayStation 4 were down, from 9.7 million units a year ago to 9 million, resulting in a slight downward trend in hardware revenue: from ¥279.8 billion to ¥270.6 billion ($2.5 billion). The PlayStation 4 has now shipped 76.5 million units worldwide.

That wasn't enough to counterbalance the performance of PlayStation software, though, and the division posted a 50 per cent operating profit increase, from ¥50 billion to ¥85.4 billion ($778m).

Overall, Sony Corp. earned ¥2.7 trillion ($25.5b) in revenue, an increase of 11.5 per cent over the prior year. Net income was 295.9 billion ($2.7b), a huge 1400 per cent increase over the 19.6 billion it earned in Q3 last year

The company kept the same full-year revenue forecast of ¥8.5 trillion, but increased its net profit forecast from ¥380 billion to ¥480 billion.

In addition to the results, Sony's Kaz Hirai announced that he would be stepping down as president and CEO of the company, with current CFO Kenichiro Yoshida scheduled to take over in April. You can read more about the coming transition here.