Sony Group Corp. on Tuesday raised its net profit forecast for the year ending next March to 1.05 trillion yen ($6.8 billion) from the earlier estimated 970 billion yen, helped by the popularity of animated film "Demon Slayer" and strong image sensor demand.
The entertainment and electronics giant expects a less severe impact from higher U.S. tariffs on its hardware, including semiconductors, with operating profit now forecast to reach 1.43 trillion yen, up from 1.33 trillion yen projected in August.
The film "Demon Slayer: Kimetsu no Yaiba -- Infinity Castle Part 1: Akaza Returns," distributed by Aniplex Inc., wholly owned by Sony Music Entertainment (Japan) Inc., has become a global hit.
"The Demon Slayer showed stronger-than-expected result," especially in the United States, Chief Financial Officer Lin Tao said at a press briefing.
She said the film and another Japanese box office hit, "Kokuho," set in the world of the traditional performing art Kabuki, boosted revenue in Sony's music segment.
"Sony intends to continue to produce fantastic live action movies and animations of superb works and make them even bigger by partnering with distributors and streaming companies in and out of Japan," Lin said.
Sony raised the fiscal 2025 revenue outlook to 12 trillion yen, up from the previous estimate of 11.7 trillion yen.
Despite the upward revision, Sony still expects to take a hit from additional U.S. tariffs because it ships products from various production bases.
It expects the higher U.S. levies will likely affect its TV and gaming businesses, pushing down its overall operating profit by 50 billion yen in the current business year.
That is smaller than the earlier forecast of 70 billion yen, as Sony excluded the negative impact on its semiconductor business from the estimate.
Sony is cautious about the global business outlook in the second half of the current fiscal year, particularly in the United States, where weak economic indicators point to "signs of slowdown," while the prolonged shutdown in the U.S. government also adds to uncertainties, the chief financial officer said.
For the April-September period, Sony said its net profit grew 13.7 percent from a year earlier to 570.45 billion yen on sales of 5.73 trillion yen, up 3.5 percent. Its operating profit jumped 20.4 percent to 768.93 billion yen.
Sony said it enjoyed higher revenues in the six months through September than a year earlier, also due to strong demand for image sensors used in mobile products and digital cameras.
The company said it benefited from "higher unit prices resulting from larger sensors being used in new products by our major customer," without giving further details.
After U.S. President Donald Trump's administration in April imposed "reciprocal" tariffs with a baseline duty of 10 percent for nearly all countries and threatened additional duties, Sony estimated a tariff impact of 100 billion yen on its operating profit as of May.
But Japan managed to negotiate down the "reciprocal" tariff to 15 percent on U.S.-bound Japanese products under a bilateral trade deal with the United States in July, while other countries exporting products to the world's largest economy also clinched deals.
==Kyodo
© Kyodo News International, Inc., source Newswire
