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PS4 boosts Sony’s full-year sales while game arm records $78M operating loss

Sony ended its fiscal year by increasing its sales and operating revenue by 14.3 percent over the previous year to 7.77 trillion yen ($75 billion), primarily attributed to the launch of the PlayStation 4 and an increase smartphone sales.

In its full consolidated results for the fiscal year ending March 31, 2014, Sony recorded a net loss of 128.4 billion yen ($1.26 billion), a decrease from last fiscal year's 41.5 billion yen net income. The company reported an operating income of 26.5 billion yen ($257 million), a decrease of 200 billion yen over the previous year.

The company's game sector recorded an operating loss of 8.1 billion yen ($78 million), down from last year's operating income of 1.7 billion yen. Partially offset by the increase in sales, the loss is attributed costs related to the launch of the PS4 and a 6.2 billion yen ($60 million) write-off on PC games sold by Sony Online Entertainment.

The arm reported sales revenue increased by 38.5 percent over the previous year to 979.2 billion yen ($9,507 million), due to the launch of the new hardware, which sold more than 7 million units worldwide as of April 6. While PlayStation 3 hardware unit sales decreased, PS3 software sales increased for the year.

Combined console sales of PS4, PS3 and PS2 totalled 14.6 million units for the fiscal year. Combined handheld sales of PS Vita TV, PS Vita and PSP for the year hit 4.1 million units, while total software sales were 374 million units.

An increase in PS4 sales and a rise in network services revenue are expected to boost the sector's sales in the future. Its operating results are projected to improve with an increase in sales and lower costs related to the launch of the PS4.

Overall, the corporation reported 91.7 billion yen ($890 million) in losses related to the PC business, including restructuring costs, as well as the battery and disc manufacturing businesses. Of that figure, 58.3 billion yen ($566 million) were costs related to Sony's exit from the PC market.

"Our decision to exit the PC business was not an easy one. It was also costly one. We recorded almost 92 billion yen in total losses associated with the business in fiscal year '13," Sony's chief financial officer Kenichiro Yoshida said in a news conference in Tokyo. "But we feel that withdrawal from the PC business is an essential step in the transformation of Sony."

Sony revised its financial forecast for the business year earlier this month for the third time in the fiscal year. The company had attributed the revision to its decision to sell its PC business and exit the PC market, along with the diminishing consumer interest in physical media such as DVDs and Blu-rays.

Sony had expected a net loss of 130 billion yen ($1.27 billion), an adjustment from February's projection of a 110 billion yen ($1.07 billion) loss. The adjusted forecast for operating income was 26 billion yen, a decrease of the previously expected 80 billion yen.

Sales for the fiscal year ending March 31, 2015 are expected to coast flat at 7.8 trillion yen due to an increase in electronics businesses sales being offset by a decrease in PC sales. Sony projects operating income of 140 billion yen and expects continued losses related to the PC business to be approximately 80 billion yen.

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