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Sony Group on Thursday reported a stronger-than-expected rise in operating profit for the December quarter, beating analyst estimates and prompting the Japanese conglomerate to raise its full-year outlook, even as it warned of rising memory costs and pressure on hardware margins.
Operating profit climbed 22% from a year earlier to 515 billion yen, topping market expectations and marking a rebound from a decline in the prior quarter. Revenue rose 1% to 3.71 trillion yen, slightly above forecasts, as solid performance across entertainment and imaging businesses helped offset softer console hardware sales.
Buoyed by the results, Sony raised its full-year operating profit forecast to 1.54 trillion yen, an increase of 110 billion yen from its previous outlook. The company also lifted its annual revenue projection by 300 billion yen to 12.3 trillion yen, while leaving its estimated impact from U.S. tariffs unchanged at 50 billion yen.
Sales in Sony's game and network services division, home to the PlayStation brand and its largest revenue contributor, slipped year over year to 1.61 trillion yen. The company cited slower console hardware sales, even as digital game purchases and subscriptions continued to provide support. Sony said PlayStation 5 console sales totaled 8 million units during the quarter, while software sales rose to 97.2 million units, helped by a strong slate of titles from both internal and external publishers.
Sony cautioned that profitability in the broader gaming business weakened due to higher hardware costs, a challenge expected to persist. PlayStation consoles rely heavily on dynamic random access memory chips, which are becoming more expensive as demand from artificial intelligence and data center operators intensifies. Market researcher TrendForce projects contract prices for conventional DRAM chips could rise as much as 95% this quarter.
Beyond gaming, Sony benefited from steady growth in its music business and live entertainment, while its image sensor unit posted roughly 20% revenue growth, supported by strong demand for mobile products. Still, management warned that the industrywide memory shortage could weigh on future smartphone demand.
Sony shares jumped nearly 6% following the earnings release, reflecting investor relief over resilient profits and the improved outlook.
