Sony Pictures hit by falling DVD sales
Sony has taken a big hit in the value of its motion picture business, thanks to an “acceleration of market decline” in home entertainment.
The company has been forced to writedown £790m in response to the poor performance of its Motion Picture arm, after warning last year that profits could be lower than expected.
Sony pointed to the faster-than-expected decline in more traditional ways of viewing films at home – including DVDs and Blu-ray discs – as part of the reason for the drop.
But it also noted that a large portion of the decline in value was historical, dating back to its acquisition of Columbia Pictures Entertainment in 1989.
The company has, however, stressed that it does not plan to offload the department, stating that “the Pictures segment continues to be an important business of Sony”.
It hopes to boost profits by further expanding its television production business, which has had some success in recent years with series including Breaking Bad spin-off Better Call Saul.
Sony’s film studio, however, has had a difficult few years, with blockbusters including an all-female reboot of Ghostbusters and sci-fi drama Passengers disappointing at the box office.
The news also comes just weeks after Sony Entertainment CEO Michael Lynton announced he would be stepping down to take up a role as chairman of Snap Inc, the parent company of social media app Snapchat.
Mr Lynton had been with Sony for 13 years and was at the helm during a high-profile hack of information from Sony Pictures including executive emails, unreleased films and pay levels for its biggest stars.
Source: Sky News – Entertainment