Sony Pictures Q3 Profit Down Slightly6 Feb, 2014 By: Erik Gruenwedel
Strong home entertainment revenue, including subscription streaming licensing from ‘Breaking Bad,’ offset lower theatrical revenue and production costs for new TV series
Sony Pictures Feb. 6 reported third-quarter (ended Dec.31, 2013) operating income of more than $239 million, which was down about 4% from operating income of $249 million during the previous-year period. Revenue increased 7% to $2.1 billion, which was actually a 13% decline when accounting for depreciation of the yen against the U.S. dollar.
The studio, which includes Sony Pictures Home Entertainment, said strong retail (and subscription streaming) sales of critically-acclaimed AMC Networks series “Breaking Bad” failed to offset lower box office receipts. While theatrical releases Captain Phillips and Cloudy With a Chance of Meatballs 2 generated strong ticket sales, they failed to measure up with the previous-year release of the latest James Bond actioner, Skyfall, which topped $1 billion at the global box office.
In addition, the previous year’s results included over-performing home entertainment sales of Men in Black 3 and The Amazing Spider-Man.
Separately, parent Sony Corp. said it is selling its money-losing PC division (operating under the Vaio brand) to Japan Industrial Partners Inc. In addition, Sony is spinning off the TV business as a wholly-owned subsidiary as it doesn’t expect the unit to achieve profitability in the current fiscal year despite market leadership positions in the new 4K Ultra-HD platform.
As a result, Sony said it would be cutting about 5,000 jobs from its global workforce.
“By implementing these measures, Sony is aiming to further enhance its TV business' profit structure and return the business to profitability during FY14,” the company said in a statement.