Streaming drives Sony Music revenue up 18.8% this quarter, but is the growth sustainable?

A 25.4% rise in global streaming revenue helped Sony Music post a year-over-year gain of 18.8% sales and operating revenue to ¥168.8 billion (A$1.91 billion) in the first quarter of its 2017 financial year.

These figures, released this week as part of parent company Sony Corp’s performance from April 1 to June 30, combined recorded, publishing, visual media and platform income.

Streaming brought in ¥38.44 billion ($435.7 million). But digital downloads continued their decline by a further 22.1% to ¥12.94 billion ($146.6 million).

Physical sales were strong, up 16.3% to ¥33.55 billion ($381.4 million) on the same period in 2016.

Altogether, the contribution of the recorded music division by itself was ¥99.82 billion ($1.13 billion), a 11.3% growth.

The major’s best-selling albums of fiscal Q1 2017 were:

Harry Styles, Harry Styles

The Chainsmokers, Memories… Do Not Open

Nogizaka46, umaretekara hajimete mita yume (It Was the First Time I Saw a Dream)

DJ Khaled, Grateful

Rag ’n’ Bone Man, Human

Future, Future

Roger Waters, Is This The Life We Really Want

Khalid, American Teen

Calvin Harris, Funk Wav Bounces Vol. 1

Shakira, El Dorado

It is also expecting releases from Arcade Fire, Foo Fighters and LCD Soundsystem to keep up the momentum.

Music publishing revenues (covering Sony/ATV, EMI and Sony Music Publishing Japan) was up 7.7% to ¥16.9 billion ($191.5 million).

Sony Corp said it now owned or administered a catalogue of 4.49 million songs within Sony/ATV and EMI Music Publishing.

Other revenue, including licensing, merchandising, and live performances, saw a slight 9.6% increase to ¥14,883 million ($168.6 million).

Through the performances of the music and games divisions, Sony Corp boasted its best ever Q1.

The Tokyo-based parent company had an impressive 15% rise to ¥1.86 trillion ($21.3 billion). Operating profit rose to ¥157.6 billion ($1.7 billion), exceeding analysts’ projected ¥133.3 billion ($1.5 billion).

While it’s heading for record profits for 2917, Chief Financial Officer Kenichiro Yoshida was cautious.

“When we marked strong earnings 10 years ago or 20 years ago, we always suffered sharp setbacks in the following year and onwards. We will keep going with a sense of pressure.”

It is clear that the company’s streamlining of its business and a greater focus on video games and superhero films is paying off.

The biggest performing division to drive Sony Corp’s to its expected record profits this year is games.

Playstation 4 sales are double that of its nearest rival, Microsoft’s XboxOne, and is expected to add new titles for Christmas to maintain its lead.

It’s once-struggling movie division is also showing signs of growth, aided by the new Spider-Man: Homecoming.