TOYKO (CelebrityAccess) — Sony announced the financial results from the first fiscal quarter of 2023 with their music division as one of the company’s few bright spots Sony’s investors.
According to Sony, the company’s music operations reported growth in sales, with revenue of 50.2 billion yen ($349.4m USD), a 16% increase when compared to the same period in the previous year. The company’s performance during this quarter was driven by increased sales in both its Recorded Music and Music Publishing divisions, as well as the favorable impact of foreign exchange rates.
Here’s a concise recap of Sony Music’s Q1 FY2023 financial results:
Surge in Sales: A Noteworthy 16% Year-on-Year Boost
During Q1 FY2023, Sony Music experienced a significant sales surge, reporting revenues of 50.2 billion yen. This impressive figure represents a substantial 16% increase when compared to the same period in the previous year. The boost in sales can be primarily attributed to higher revenue from paid subscription streaming services, which notably contributed to both the Recorded Music and Music Publishing segments. Furthermore, the positive influence of foreign exchange rates played a pivotal role, accounting for a substantial increase of 15.2 billion yen in sales.
Operating Income and Adjusted OIBDA Exhibit Robust Growth
Sony Music’s Operating Income (OI) during Q1 FY2023 displayed impressive growth during the quarter, surging by 20% to reach 12.4 billion yen. This growth can be attributed to multiple factors, including heightened sales in the Recorded Music and Music Publishing sectors. Additionally, the favorable impact of foreign exchange rates contributed positively to the company’s bottom line.
The Adjusted Operating Income Before Depreciation and Amortization (OIBDA) also experienced a substantial 11% increase, reaching 8.2 billion yen. This growth was driven by increased sales in Recorded Music and Music Publishing, as well as a noteworthy remeasurement gain of 6.0 billion yen arising from the consolidation of a previously equity-accounted company. The positive influence of foreign exchange rates further added to the growth in Adjusted OIBDA. However, a rise in selling, general, and administrative expenses slightly offset the gains.
Positive Outlook and Upward Revision of FY2023 Forecast
Sony Music’s management holds an optimistic outlook for the remainder of fiscal year 2023. The company has revised its sales forecast upwards to 80 billion yen, representing a 6% increase from the initial April projection. This upward revision primarily accounts for the continuing favorable influence of foreign exchange rates.
The Operating Income (OI) forecast has also been adjusted upwards to 15 billion yen, reflecting a 6% increase, and the Adjusted OIBDA forecast now stands at 10 billion yen, marking a 3% increase. Sony anticipates that results for the remainder of 2023 will be driven by the ongoing favorable effects of foreign exchange rates and the remeasurement gain resulting from the consolidation of a previously accounted-for entity.
