Sony raises annual operating profit forecast on gaming strength

Sony raised its full-year operating profit forecast by 8 per cent to 1.72 trillion yen (US$10.72 billion), citing the strength of its gaming business, the Japanese conglomerate said.

The company pointed to the impact of US tariff refunds, a boost from exchange rates and cost control for the rosier outlook for its gaming unit. Sony also raised the forecast for its image sensors business, citing higher sales and exchange rates.

In the April-June quarter, Sony's group operating profit rose 40 per cent to 476.5 billion yen, beating analyst estimates. The strength of the gaming and image sensors businesses drove the rise.

Sony has secured memory chip supply for the current financial year and expects continued high memory chip prices next year. The market has been concerned about the impact of AI and a memory chip price boom on Sony's business.

Sony is expected to be a major beneficiary of the launch of 'Grand Theft Auto VI' on Nov 19. Ampere Analysis analyst Piers Harding-Rolls forecast that Take-Two Interactive Software could sell 30 million to 35 million 'GTA VI' units by year-end.

The major in-house title 'God of War Laufey' is due for release on PlayStation 5 in February. Microsoft's Xbox business is retrenching.

Analysts on average expect Sony to report an operating profit of 465 billion yen for the July-September quarter. Sony's shares were down 8 per cent year-to-date ahead of the earnings.

Sony has been shifting its resources toward accumulating entertainment assets spanning music, games and anime, while scaling back in low-margin areas in consumer electronics.

Separately, camera lens maker Tamron said it had received an acquisition proposal from Sony and established a committee to review its options. Sony is a leading manufacturer of cameras and image sensors; Tamron is a supplier of lenses for cameras made by Sony, Nikon and Canon.