Sony Projects Stagnant Profits as Tariff Costs Mount

Sony has forecast a slight increase in operating profit for the fiscal year ending March, anticipating a 0.3% rise to 1.28 trillion yen ($8.7 billion). 

This outlook includes a projected loss of 100 billion yen due to tariffs stemming from trade tensions initiated under U.S. President Donald Trump’s administration. 

The company noted that the tariff estimate does not take into account the recent trade agreement between the United States and China, and the eventual financial impact could be significantly different.

Shares of Sony rebounded in afternoon trading, gaining more than 2% after earlier dropping over 3%. 

The company’s transformation from a consumer electronics manufacturer to a diversified entertainment group continues under the leadership of Hiroki Totoki, who recently assumed the role of CEO. 

Totoki is spearheading a strategy centered on content and services, rather than traditional hardware.

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Gaming Division Struggles While Strategic Realignment Advances

As part of its shift in focus, Sony is preparing to partially spin off its financial services division by October, retaining under 20% ownership. This move is aimed at strengthening the core entertainment operations, which include music, movies, gaming, and semiconductors.

In the gaming segment, Sony reported a decline in momentum. Sales of PlayStation 5 units fell to 2.8 million in the fourth quarter — a 38% year-over-year drop. 

This decline also affected the division’s profitability, with operating profit falling by 12.5%. Price increases for the PS5 in Europe and the UK were implemented last month in response to inflation and currency shifts.

Despite the recent downturn, Sony anticipates a 16% rise in profits for its gaming unit this year. 

This optimism is largely attributed to expected demand for in-house titles, including the upcoming release of Ghost of Yotei in October — a follow-up to the hit game Ghost of Tsushima, which has sold 13 million copies across PlayStation and PC platforms.

Looking ahead, analysts believe that the highly anticipated Grand Theft Auto VI could reinvigorate console demand. However, publisher Take-Two Interactive has postponed the game’s launch until May 2026.

Overall, Sony’s operating income, including earnings from its financial services, climbed 16% to 1.4 trillion yen for the year that ended in March, surpassing market expectations.

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