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Sony Corporation (JP:6758)
:6758
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Sony
(OTC:6758)
Rating:64Neutral
Price Target:
¥3,815.00
▲(7.01%Upside)
Positive Factors
Entertainment Expansion
Sony has a series of high-profile game and movie releases in the pipeline, potentially boosting its entertainment segment.
Financial Performance
Sony Financial Group’s ROE target for FY3/27 is 10% or more, showing a significant improvement from FY3/25.
Technology and Innovation
The shift to higher density sensors and improved imaging technology is expected to drive growth in Sony's business.
Negative Factors
Bond Sales Losses
Selling USD-denominated bonds is expected to result in losses on sales of USD bonds of ¥65-¥70bn in FY3/26 and FY3/27.
Investment Efficiency
I&SS needs to improve investment efficiency given its FY3/25 ROIC of just 9.8%, highlighting a potential area of concern in financial performance.
Sony (6758) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
$21.78T
Dividend Yield0.56%
Average Volume (3M)12.26M
Price to Earnings (P/E)18.9
Beta (1Y)1.19
Revenue Growth-0.49%
EPS Growth19.71%
CountryJP
Employees113,000
SectorTechnology
Sector Strength93
IndustryConsumer Electronics
Share Statistics
EPS (TTM)32.88
Shares Outstanding6,149,810,500
10 Day Avg. Volume10,916,010
30 Day Avg. Volume12,263,356
Financial Highlights & Ratios
PEG Ratio-0.48
Price to Book (P/B)2.63
Price to Sales (P/S)0.00
P/FCF Ratio7.64
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$4,439.20Price Target Upside24.52% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
Sony Business Overview & Revenue Model
Company DescriptionSony Corporation, headquartered in Tokyo, Japan, is a multinational conglomerate known for its diverse range of products and services across several sectors. These include electronics, gaming, entertainment, and financial services. Sony is renowned for its consumer electronics products such as televisions, audio equipment, and cameras. The company also has a significant presence in the gaming industry through its PlayStation brand, and in the entertainment sector with Sony Pictures and Sony Music, which produce and distribute films, television shows, and music globally.
How the Company Makes MoneySony generates revenue through a variety of streams across its multiple business segments. The electronics segment earns money from the sale of consumer and professional electronics, which include televisions, audio devices, and cameras. Sony's gaming segment, anchored by the PlayStation brand, profits from hardware sales, game software, and network services subscriptions. The entertainment segment contributes through Sony Pictures and Sony Music, which earn from box office sales, home entertainment, licensing, and music streaming. Additionally, Sony's financial services, primarily operated through Sony Financial Holdings, provide insurance and banking services, contributing to the company's earnings. Significant partnerships, such as collaborations for content distribution and technology development, also play a role in enhancing Sony's revenue.
Sony Earnings Call Summary
Earnings Call Date:May 14, 2025
(Q3-2024)
| % Change Since: -2.44%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Positive
The earnings call presented a strong performance, particularly in the Games & Network Services and Music segments, with record-high income and a positive revision of the full-year forecast. However, challenges were noted in the Pictures and ET&S segments, alongside a decline in operating income in financial services. Despite these challenges, the overall growth and strategic planning suggest optimism.Q3-2024 Updates
Positive Updates
Record Sales and Operating Income
Consolidated sales excluding the financial services segment increased 7% year-on-year to ¥3,695.7 trillion. Operating income increased 10% to ¥423 billion. Including the financial services segment, sales increased 18% year-on-year to ¥4,409.6 trillion, and operating income increased 1% to ¥469.3 billion, setting a record for the third quarter.
Strong Performance in Games & Network Services
Sales for the quarter increased 16% year-on-year to ¥1,682.3 billion, with operating income increasing 37% year-on-year to ¥118.1 billion, a record high for the third quarter. The number of monthly active users across PlayStation platforms reached 129 million, the highest in PlayStation history.
Music Segment Growth
Sales for the quarter increased 14% year-on-year to ¥481.7 billion, primarily due to higher streaming revenue. Operating income increased 28% year-on-year to ¥97.4 billion.
Upward Revision of Full Year Forecast
Consolidated sales, including the financial services segment, have been upwardly revised 4% from the previous forecast to ¥13.200 trillion. Operating income has been revised upward by 2% to ¥335 billion, and net income has been revised upward by 10% to ¥1.80 trillion.
Negative Updates
Challenges in the Pictures Segment
Operating income in the Pictures segment decreased 18% year-on-year to ¥34 billion due to increased marketing costs for theatrical releases and the impact of production delays from strikes.
ET&S Segment Sales Decline
Sales for the ET&S segment decreased 4% year-on-year to ¥704.5 billion, primarily due to a decrease in unit sales of televisions. The segment faces a severe operating environment, with further fixed cost reduction measures planned.
Decreased Operating Income in Financial Services
Operating income in the financial services segment decreased ¥30.9 billion year-on-year to ¥46.4 billion, largely due to the absence of significant gains related to market fluctuations recorded in the previous fiscal year.
Company Guidance
During Sony Group Corporation's fiscal year 2024 third-quarter earnings call, significant guidance was provided, highlighting several key financial metrics. Consolidated sales excluding the financial services segment increased 7% year-on-year to ¥3,695.7 trillion, while operating income rose 10% to ¥423 billion. Including the financial services segment, consolidated sales surged 18% to ¥4,409.6 trillion, with operating income climbing 1% to a record ¥469.3 billion for the third quarter. Notably, net income increased 3% to ¥373.7 billion. The company revised its full-year forecast upward, projecting consolidated sales of ¥11.900 trillion, up 4% from the previous forecast, and operating income of ¥335 billion, a 2% increase. The PlayStation segment experienced remarkable growth, with sales up 16% year-on-year to ¥1,682.3 billion, and operating income soaring 37% to ¥118.1 billion. The Music segment also saw a 14% rise in sales to ¥481.7 billion and a 28% increase in operating income to ¥97.4 billion. Meanwhile, the Pictures segment's sales grew 9% to ¥398.2 billion, although operating income decreased 18% to ¥34 billion. The company emphasized its strategic focus on enhancing local music repertoire and strengthening engagements in the Anime sector, with expectations for continued growth driven by innovative content and technological advancements.Sony Financial Statement Overview
Summary
Sony exhibits a robust financial profile with strong profitability, solid leverage management, and healthy cash flows. The income statement reflects significant operational efficiency and stable profitability, while the balance sheet is well-positioned to support growth. Cash flow generation is strong, highlighting efficient cash conversion and ample free cash availability for reinvestment.Income Statement
Sony's income statement demonstrates robust performance with a significant gross profit margin of 28.3% and a net profit margin of 8.8% for the latest year. The revenue growth rate over the past year was a modest 1.2%, but the company has shown consistent revenue growth over the past five years. The EBIT margin of 10.8% and EBITDA margin of 20.9% reflect strong operational efficiency. The overall trajectory indicates stable profitability with room for future growth.85
Very Positive
Balance Sheet
The balance sheet shows a healthy financial position with a debt-to-equity ratio of 0.51, indicating a balanced approach to leveraging. The return on equity (ROE) stands at 14.0%, showcasing effective utilization of shareholder funds. The equity ratio of 23.2% suggests a solid equity base, though there is potential to improve asset financing through equity. The balance sheet remains stable and well-positioned to support further growth.78
Positive
Cash Flow
Sony's cash flow statement highlights strong cash generation capabilities with an operating cash flow to net income ratio of 2.76, reflecting efficient cash conversion from earnings. The free cash flow to net income ratio of 2.19 indicates ample free cash availability for reinvestment. Remarkably, the free cash flow growth rate was significant over the past year, underscoring a strong cash flow trajectory.82
Very Positive
| Breakdown | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 12.96T | 13.02T | 11.54T | 9.92T | 9.00T |
| Gross Profit | 3.66T | 3.34T | 3.14T | 2.70T | 2.44T |
| EBITDA | 2.71T | 2.46T | 2.29T | 2.03T | 1.74T |
| Net Income | 1.14T | 970.57B | 1.01T | 882.18B | 1.03T |
Balance Sheet | |||||
| Total Assets | 35.29T | 34.11T | 32.04T | 30.48T | 26.35T |
| Cash, Cash Equivalents and Short-Term Investments | 3.43T | 2.33T | 1.92T | 2.56T | 4.69T |
| Total Debt | 4.20T | 4.09T | 3.91T | 3.35T | 2.46T |
| Total Liabilities | 26.78T | 26.35T | 24.75T | 23.28T | 20.73T |
| Stockholders Equity | 8.18T | 7.59T | 6.60T | 7.14T | 5.58T |
Cash Flow | |||||
| Free Cash Flow | 2.50T | 749.27B | -298.94B | 792.55B | 837.91B |
| Operating Cash Flow | 3.15T | 1.37T | 314.69B | 1.23T | 1.35T |
| Investing Cash Flow | -779.32B | -818.89B | -1.05T | -728.78B | -960.61B |
| Financing Cash Flow | -449.05B | -210.71B | 84.30B | -336.58B | 58.16B |
Sony Technical Analysis
Negative
3565.00
Price Trends
3703.00
Negative
3632.46
Negative
3370.24
Positive
Market Momentum
-33.54
Positive
42.81
Neutral
27.80
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:6758, the sentiment is Negative. The current price of 3565 is below the 20-day moving average (MA) of 3636.10, below the 50-day MA of 3703.00, and above the 200-day MA of 3370.24, indicating a neutral trend. The MACD of -33.54 indicates Positive momentum. The RSI at 42.81 is Neutral, neither overbought nor oversold. The STOCH value of 27.80 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:6758.
Sony Peers Comparison
Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $3.34T | 9.12 | 7.85% | 2.80% | -0.45% | -17.53% | |
73 Outperform | ¥169.00B | 8.29 | 16.78% | 2.41% | 3.02% | 60.53% | |
69 Neutral | ¥265.44B | 33.08 | 3.45% | 3.86% | -2.63% | -31.17% | |
68 Neutral | ¥228.97B | 14.57 | 7.50% | 2.73% | 9.28% | 6.70% | |
64 Neutral | $21.78T | 18.89 | 14.32% | 0.56% | -0.49% | 19.71% | |
64 Neutral | ¥2.27T | 94.18 | 0.71% | 3.10% | 0.51% | -76.08% | |
51 Neutral | ¥421.49B | 11.68 | ― | -6.97% | ― |
* Technology Sector Average
Performance Comparison
JP:6758
Sony
3,565.00
745.28
26.43%
JP:6753
Sharp Corporation
649.20
-256.10
-28.29%
JP:6632
JVCKENWOOD Corporation
1,120.50
214.29
23.65%
JP:6752
Panasonic
1,430.00
222.57
18.43%
JP:6971
Kyocera
1,611.00
-235.67
-12.76%
JP:6952
Casio Computer Co
1,165.00
-4.70
-0.40%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.