Sony Group Corporation (SONY - Free Report) reported mixed second-quarter fiscal 2021 results, wherein the bottom line beat the Zacks Consensus Estimate but the top line missed the same.
Net Income
On a GAAP basis, net income in the quarter decreased 53.5% year over year to ¥213.1 billion ($1,935.6 million) or ¥170.26 ($1.55) per share. The decline was mainly due to higher financial expenses and income tax. The bottom line beat the Zacks Consensus Estimate by 7 cents.
Adjusted net income came in at ¥209.2 billion compared with ¥254.4 billion in the prior-year quarter.
Revenues
Quarterly total revenues increased 12.6% year over year to ¥2,369.4 billion ($21,523 million). The rise was driven by an increase in Game & Network Services (G&NS), Pictures, Music, and Electronics Products & Solutions (EP&S) segments sales. The top line, however, missed the consensus estimate of $21,958 million.
Segment Results
G&NS sales grew 27.4% year over year to ¥645.4 billion, driven by a rise in sales of hardware, a positive impact of foreign exchange rates, and an increase in sales of non-first-party titles including add-on content. The segment’s operating income was ¥82.7 billion compared with ¥105.4 billion in the prior-year quarter.
Music sales increased 17.6% year over year to ¥271.6 billion, driven by higher sales of recorded music and music publishing, an increase in revenues from paid subscription streaming services, and a rise in revenues from advertising-supported streaming services, which were affected by the pandemic in second-quarter fiscal 2020. Operating income was ¥50.6 billion, which declined from ¥54.3 billion in the prior-year quarter.
Pictures sales increased 39.8% year over year to ¥260.7 billion. This was driven by higher sales of television productions, media networks, and motion pictures. Operating income was ¥31.6 billion compared with ¥32.8 billion a year ago.
EP&S sales came in at ¥581.9 billion, up 9.1% year over year, driven by an increase in sales of smartphones and a positive impact of foreign exchange rates. Operating income was ¥72.7 billion compared with ¥53.4 billion in the year-ago quarter.
Imaging & Sensing Solutions sales were down 9.4% year over year to ¥278.3 billion due to a decrease in sales of image sensors for mobile products. Operating income was ¥49.7 billion compared with ¥50.8 billion in the prior-year quarter.
Financial Services sales were almost flat year over year at ¥368.4 billion, which reflects an increase in insurance premium revenues and a decrease in gains on investments. Operating income was ¥43.1 billion compared with ¥37 billion in the year-ago quarter.
All Other sales were up 7% to ¥24.5 billion. Operating income was ¥8.6 billion compared with ¥1.5 billion a year ago.
Other Details
Total expenses were ¥2,059.3 billion, up 14.9% year over year. Operating income was ¥318.5 billion, up 1%.
Cash Flow & Liquidity
During the first six months of fiscal 2021, Sony generated ¥317 billion of cash from operating activities compared with ¥600.9 billion in the prior-year period.
As of Sep 30, 2021, the company had ¥1,473.8 billion ($13,192 million) in cash and cash equivalents with ¥995.8 billion ($8,913.4 million) of long-term debt.
FY21 Outlook Raised
Sony has provided the outlook for the fiscal year ending Mar 31, 2022. It now expects sales of ¥9,900 billion, increasing from the August forecast of ¥9,700 billion. Operating income is projected to be ¥1,040 billion, increasing from ¥980 billion. Net income is estimated to be ¥730 billion, up from ¥700 billion.
Zacks Rank & Stocks to Consider
Sony currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader sector are Ooma, Inc. (OOMA - Free Report) , Ubiquiti, Inc. (UI - Free Report) , and SeaChange International, Inc. (SEAC - Free Report) . While Ooma sports a Zacks Rank #1 (Strong Buy), Ubiquiti and SeaChange carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Ooma delivered a trailing four-quarter earnings surprise of 55.2%, on average.
Ubiquiti pulled off a trailing four-quarter earnings surprise of 20.5%, on average.
SeaChange delivered a trailing four-quarter earnings surprise of 28.9%, on average.
Conversion rate used:¥1 = $0.009083 (period average from Jul 1, 2021 to Sep 30, 2021)
¥1 = $0.008951 (as of Sep 30, 2021)
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It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
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Sony Group Corporation (SONY - Free Report) reported mixed second-quarter fiscal 2021 results, wherein the bottom line beat the Zacks Consensus Estimate but the top line missed the same.
Net Income
On a GAAP basis, net income in the quarter decreased 53.5% year over year to ¥213.1 billion ($1,935.6 million) or ¥170.26 ($1.55) per share. The decline was mainly due to higher financial expenses and income tax. The bottom line beat the Zacks Consensus Estimate by 7 cents.
Adjusted net income came in at ¥209.2 billion compared with ¥254.4 billion in the prior-year quarter.
Revenues
Quarterly total revenues increased 12.6% year over year to ¥2,369.4 billion ($21,523 million). The rise was driven by an increase in Game & Network Services (G&NS), Pictures, Music, and Electronics Products & Solutions (EP&S) segments sales. The top line, however, missed the consensus estimate of $21,958 million.
Segment Results
G&NS sales grew 27.4% year over year to ¥645.4 billion, driven by a rise in sales of hardware, a positive impact of foreign exchange rates, and an increase in sales of non-first-party titles including add-on content. The segment’s operating income was ¥82.7 billion compared with ¥105.4 billion in the prior-year quarter.
Music sales increased 17.6% year over year to ¥271.6 billion, driven by higher sales of recorded music and music publishing, an increase in revenues from paid subscription streaming services, and a rise in revenues from advertising-supported streaming services, which were affected by the pandemic in second-quarter fiscal 2020. Operating income was ¥50.6 billion, which declined from ¥54.3 billion in the prior-year quarter.
Pictures sales increased 39.8% year over year to ¥260.7 billion. This was driven by higher sales of television productions, media networks, and motion pictures. Operating income was ¥31.6 billion compared with ¥32.8 billion a year ago.
EP&S sales came in at ¥581.9 billion, up 9.1% year over year, driven by an increase in sales of smartphones and a positive impact of foreign exchange rates. Operating income was ¥72.7 billion compared with ¥53.4 billion in the year-ago quarter.
Imaging & Sensing Solutions sales were down 9.4% year over year to ¥278.3 billion due to a decrease in sales of image sensors for mobile products. Operating income was ¥49.7 billion compared with ¥50.8 billion in the prior-year quarter.
Financial Services sales were almost flat year over year at ¥368.4 billion, which reflects an increase in insurance premium revenues and a decrease in gains on investments. Operating income was ¥43.1 billion compared with ¥37 billion in the year-ago quarter.
All Other sales were up 7% to ¥24.5 billion. Operating income was ¥8.6 billion compared with ¥1.5 billion a year ago.
Other Details
Total expenses were ¥2,059.3 billion, up 14.9% year over year. Operating income was ¥318.5 billion, up 1%.
Cash Flow & Liquidity
During the first six months of fiscal 2021, Sony generated ¥317 billion of cash from operating activities compared with ¥600.9 billion in the prior-year period.
As of Sep 30, 2021, the company had ¥1,473.8 billion ($13,192 million) in cash and cash equivalents with ¥995.8 billion ($8,913.4 million) of long-term debt.
FY21 Outlook Raised
Sony has provided the outlook for the fiscal year ending Mar 31, 2022. It now expects sales of ¥9,900 billion, increasing from the August forecast of ¥9,700 billion. Operating income is projected to be ¥1,040 billion, increasing from ¥980 billion. Net income is estimated to be ¥730 billion, up from ¥700 billion.
Zacks Rank & Stocks to Consider
Sony currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader sector are Ooma, Inc. (OOMA - Free Report) , Ubiquiti, Inc. (UI - Free Report) , and SeaChange International, Inc. (SEAC - Free Report) . While Ooma sports a Zacks Rank #1 (Strong Buy), Ubiquiti and SeaChange carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Ooma delivered a trailing four-quarter earnings surprise of 55.2%, on average.
Ubiquiti pulled off a trailing four-quarter earnings surprise of 20.5%, on average.
SeaChange delivered a trailing four-quarter earnings surprise of 28.9%, on average.
Conversion rate used:
¥1 = $0.009083 (period average from Jul 1, 2021 to Sep 30, 2021)
¥1 = $0.008951 (as of Sep 30, 2021)
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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