Q2 sales, profits, up at Sony Music

Sony Corp’s Q2 results showed that while many of the Japanese corporation’s division showed declines, Sony Music was once again a profitable division.

It reported an 8% (19% on a constant currency basis) increase in sales to US$1.49 billion during the three months to September 30. Operating income was up 16% to $164 million.

Sony Music revenue is a combined result of Sony Music Entertainment and Sony/ATV Music Publishing.

Recording music revenue dropped 1% to $865 million while publishing revenues dropped 11.9% to $150 million. During this period, Sony acquired Michael Jackson’s 50% of Sony/ATV.

“Recorded Music sales increased primarily due to an increase in digital streaming revenues,” the company said in its earnings statement. Streaming accounted for 41.5% ($303 million) of quarterly revenues, with a year-on-year growth of 26.6%.

Physical sales were 40% of its Q2 revenues. Downloads continued their fall, down 31.6% year-on-year and accounting for just 18% of revenue.

Sony Music’s biggest hits came from outside the United States: Celine Dion’s Encore un soir; Japanese Idol group Nogizaka46’s Hadashi de Summer and Japanese singer songwriter Kana Nishino’s Just Love.

Sony Corp.’s overall net profit for the July to September period fell 86% from $3.2 billion a year earlier to $45.8 million. Sales dropped nearly 11% in the quarter as the strong yen hurt earnings of Japanese exporters.

Sony’s film unit posted an operating profit of $32m, compared to a of $187m loss in the 2015 Q2. Theatrical revenues helped push sales up almost 5% to $1.9 billion. Hits on the film side included Ghostbusters and Pixels, but neither met their financial targets.

On the positive, its mobile business again showed that it has stopped bleeding cash. Its Q2 profits of $37 million was a marked difference from the $172 million loss from a year before.

PlayStation was its most notable performer: sales decline by 11% year-on-year primarily due to currency changes, but still generated $3.2 billion.