On Friday, Japanese tech giant Sony announced Q3 results.

Boosted by strong gaming, music, and online businesses, Sony's sales and operating profit greatly exceeded expectations; at the same time, the company also raised sales guidelines for the whole year.

After the financial report was announced, Sony's US stock rose more than 4% in the premarket.

Operating profit surged 73% year over year

According to financial reports, for the second fiscal quarter ending September 30, the company's revenue was 2.9056 trillion yen, an increase of 3% over the previous year.

Operating profit was 455.1 billion yen, compared to 263 billion yen in the same period last year, up 73% year over year, exceeding market expectations. Net profit reached 338.5 billion yen, up 69% year over year.

According to reports, Sony's business covers music, movies, games, and chips.

In terms of revenue by sector, revenue from businesses such as gaming and network services, music, imaging and sensing solutions experienced an increase in the second fiscal quarter, and revenue from Sony Pictures declined.

Among them, sales of games and online services were 1071.5 billion yen (7.01 billion US dollars), an increase of 12% over the same period last year.

The revenue of the game and internet service business (G&NS) was 138.8 billion yen (0.908 billion US dollars), an increase of 2.8 times over the same period last year.

According to reports, Sony's PS5 console sales this quarter were 3.8 million units, down from 4.9 million units in the same period last year.

Sony's game sales volume was 77.7 million copies, up from 67.6 million copies in the same period last year. First-party games sold 5.3 million copies, up from 4.7 million copies in the same period last year.

Additionally, hardware sales were 218.2 billion yen, down from 287.5 billion yen in the same period last year.

Game software sales were 612.3 billion yen, up from 479.3 billion yen in the same period last year. Digital software sales were 258.6 billion yen, up from 200.9 billion yen in the same period last year.

Sony said the increase in sales was due to increased sales of third-party game software, improved foreign exchange rates, and increased sales of online services, including PlayStation Plus online services. The increase in sales was offset by a decline in hardware sales.

The increase in revenue was driven by increased hardware profitability, increased sales of third-party software, and increased sales of network services.

Guidelines for increasing annual revenue

In addition to exceeding expectations, Sony also raised its revenue forecast for the fiscal year ending March 2025 and maintained its net profit outlook.

The company slightly raised its revenue forecast for the current fiscal year to 12.7 trillion yen, compared to 12.6 billion yen previously.

Sony also expects full-year operating profit of 1.3 trillion yen, in line with previous forecasts; net profit is expected to be 980 billion yen, up 1% from last year.

The current forecast is that its gaming and online services division's annual revenue will reach 4.49 trillion yen, which is more optimistic than the 4.32 trillion yen forecast in August.

Furthermore, the division's revenue for the current fiscal year is also expected to increase by 35 billion yen.

Over the past few years, Sony has spent billions of dollars on acquisitions to boost entertainment content creation.

Its entertainment business, such as games, music, and movies, accounted for nearly 60% of overall revenue in the most recent fiscal year, up from about 30% a decade ago.

Currently, Sony plans to split its insurance and online banking business and go public in 2025 to focus on its core entertainment business.