Sony forecasts flat profit this year as tariffs hit

Reuters | May 14, 2025 | 03:23 PM IST | Breaking News, Business | Follow on Google News

Sony forecasts flat profit this year as tariffs hit

TOKYO, May 14 (Reuters) – Sony (6758.T) said on Wednesday it expects operating profit to rise 0.3% to 1.28 trillion yen ($8.7 billion) in the financial year ending in March, after factoring in a 100 billion yen hit from U.S. President Donald Trump’s trade war.

The estimated tariff impact does not reflect this week’s trade deal between the United States and China and the actual impact could vary significantly, Sony said.

Sony’s shares erased their losses and closed up 3.7% after the results were announced. The company said it would buy back up to 100 million shares for some 250 billion yen.

The Japanese conglomerate has transformed from a maker of household electronics such as the Walkman to an entertainment behemoth spanning games, movies, music and chips.

President Hiroki Totoki has strengthened his grip over the conglomerate, taking the CEO role last month.

He has emphasised a continued focus on entertainment, with Sony preparing for a partial spin-off of its financial unit.

The spin-off will leave Sony with a stake of less than 20% with the business to list in Tokyo on September 29.

“We have seen the resilience of entertainment businesses during economic downturn, like during the COVID-19 pandemic,” Totoki told an earnings briefing.

Sony sold 2.8 million PlayStation 5 (PS5) units in the January-March quarter, a 38% drop compared to a year earlier.

Operating profit at the gaming unit fell by 12.5% over the same period.

Sales were in line with expectations following the year-end shopping season, Chief Financial Officer Lin Tao said.

Sony raised PS5 prices in Europe and Britain last month, citing higher inflation and exchange rate fluctuations.

The company has been stockpiling inventory in the U.S. and diversifying hardware production.

Sony expects profit at the games business to increase by 16% this year due to higher sales of first-party games.

Lin said the company is aiming for sales of 15 million PS5 units this year but emphasised there were many uncertainties.

“Ghost of Yotei” is set to launch in October, following the success of “Ghost of Tsushima” which has sold 13 million units on PlayStation and PC.

Reuters