Sony Corp. has announced its financials for the fiscal year ended Mar. 31, 2016. The company saw sales and operating revenue decrease 1.3 percent, to $71.7 million (¥8.1 billion), largely due to a 20 percent drop in mobile communications sales, according to the company. Operating income jumped significantly year-on-year, from ¥68.5 billion (roughly $637.8 million) to ¥294.2 billion (roughly $2.7 billion). The company attributed this dramatic growth in operating income to mobile communications results improvements, as well as a $151 million gain from “the remeasurement to fair value” Sony Music’s 51 percent stake in The Orchard. On a constant currency basis, sales companywide were down 4 percent year-on-year.
Music sales and operating revenue increased 10.4 percent over 2015, to ¥617.6 billion ($5.4 billion). Music’s operating income was up 44.1 percent, to $773 million. The division includes the company’s recorded music and publishing (Sony/ATV) segments. Chief Financial Officer Kenichiro Yoshida said of the publishing division that “music publishing is one of our recurring revenue businesses, and this strategic investment was aimed at enhancing that part of our business.”
Streaming revenue — the combined revenue from paid and ad-supported services, digital audio, digital video and digital radio — increased 8 percent, from 19 percent to 27 percent of total recorded revenues for the division.
While the other two majors, Universal Music Group and Warner Music Group, both saw streaming revenue overtake physical in their most recent financial results, Sony Music reports physical sales accounting for 38 percent of revenue, with downloads at 21 percent and streaming at 27 percent ($986 million). and downloads at 24 percent. The numbers clearly point towards streaming’s future dominance and the ship-in-the-night transfer of download spending to streaming — 2015 numbers peg streaming at 19 percent of music revenue.
Best-selling records (in order) include Adele‘s smash 25, One Direction‘s Made In the A.M., David Bowie‘s Blackstar, Meghan Trainor‘s Title and Sia‘s 1000 Forms of Fear. Last year the list was topped by One Direction’s FOUR, AC/DC‘s Rock or Bust, Trainor’s Title, Calvin Harris‘ Motion and Michael Jackson‘s XSCAPE.
The company forecasts an 11 percent decrease in sales and operating revenue for its music divisions over the next year and a $226.3 million decrease in operating revenue because of exchange rates as well as the $151 million windfall from The Orchard remeasurement and the lack of any Adele-like releases over the next year.