Sony Corp. on Wednesday raised its earnings outlook for the current business year through next March, factoring in strong game software and game subscription businesses despite the negative fallout from U.S. restrictions on semiconductor exports to a Chinese telecom giant.

Sony now expects a net profit of 800 billion yen ($7.7 billion), up 37.4 percent from a year earlier, and sales to rise 2.9 percent to 8.5 trillion yen. It previously forecast 510 billion yen in net profit and 8.3 trillion yen in sales. It revised upward its operating profit estimate from 620 billion yen to 700 billion yen, which would be a decline of 17.2 percent from a year earlier.

The Japanese firm raised its sales forecasts made in August for game, music and financial service segments, but it cut its outlook by 40 billion yen for the image sensor segment after the U.S. government tightened the screws on China, restricting exports to China's Huawei Technologies Co. due to national security concerns.

"The U.S. government's move to strengthen export restrictions on our major Chinese customer is having a seriously negative impact on our image sensor business. But our gaming and other businesses continue to benefit from strong demand from people staying at home amid the coronavirus pandemic," Sony Chief Financial Officer Hiroki Totoki said during an online press briefing to report the company's first-half results.

The release of the earnings report came ahead of the launch in November of the PlayStation 5 game console. Totoki said the company is aiming to sell more than 7.6 million units in the first year of launch, exceeding the PlayStation 4's first-year shipments.

Despite the declining PlayStation 4 shipments, sales of its software in the six months to September grew from a year earlier as people spent more time and money on video games after the coronavirus outbreak.

The members of Sony's PS Plus subscription service continued to increase after showing strong growth in the April-June quarter. Sony raised its sales outlook for the game segment to 2.6 trillion yen from the previously estimated 2.5 trillion yen.

Though theater closures due to the pandemic have hurt its movie business, Sony left its full-year sales estimate for the segment unaltered thanks to higher-than-expected sales of its movies' TV licensing.

For the April-September period, Sony's net profit doubled from a year before to 692.89 billion yen, as it continued to see strong demand for games and other products.

Sony reported 546.16 billion yen in operating profit, up 7.1 percent, while sales increased 0.9 percent to 4.08 trillion yen.

==Kyodo

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