Sony raises full-year forecast after Q1 profit jumps 40%

Sony Group reported a 40% surge in first-quarter operating profit on Friday, beating analyst expectations and prompting the Japanese conglomerate to raise its full-year earnings forecast on the back of strong performance in its gaming and image sensor businesses.

Earnings Beat Expectations

Operating income for the three months ended June 30 rose to 476.5 billion yen ($2.97 billion), while net profit climbed 32% year-on-year to 342.16 billion yen ($2.15 billion), well above the analyst consensus estimate of 262.6 billion yen compiled by Visible Alpha. Revenue grew 8% to 2.84 trillion yen.investing+2

Sony raised its fiscal year 2026 operating profit forecast by 8% to 1.72 trillion yen from the 1.60 trillion yen it projected in May. The company also lifted its net profit outlook to 1.21 trillion yen from 1.16 trillion yen and increased its revenue forecast to 12.5 trillion yen.marketscreener+1

Gaming and Sensors Drive Growth

The imaging and sensing business was the largest contributor to earnings growth, with operating profit more than doubling on stronger sales of mobile image sensors, an improved product mix, and favorable currency movements. The Game & Network Services division posted a 37% rise in operating profit, aided by U.S. tariff refunds and exchange rate gains, while PlayStation monthly active users reached a record 125 million in June.investing+2

Sony sold 1.6 million PlayStation 5 consoles during the quarter, roughly a third fewer than the year-earlier period. The company said it expects to benefit from the launch of "Grand Theft Auto VI" on November 19, as Microsoft's ↗ 3.02% Xbox business retrenches.investing

Outlook and Risks

Sony noted it has secured enough memory chip supply for the current fiscal year and expects hardware profitability to remain similar to the prior year. However, the company cautioned that memory market conditions could weigh on high-end smartphone shipments in the second half.investing+1

The revised guidance excludes any financial impact from the July 28 Kumamoto earthquake, which affected several Sony semiconductor facilities in the region. Sony said there were no major casualties and most production has resumed, but it cannot yet estimate the financial effects.variety+1

Separately, Sony on Thursday disclosed it had made an acquisition proposal to Japanese camera-lens maker Tamron as part of efforts to strengthen its camera business.marketscreener