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Sony Music Profit Surges 38% on Streaming Growth

Moving over to annual results, Sony’s music operations, which includes Sony Music Entertainment and Sony Music Japan as well as the Visual Media/Platform, the segment produced operating income of ¥188.1 billion yen ($1.77 billion) on ¥927.3 billion yen ($8.74 billion). That represents a 35.4% increase (on a dollar basis) in operating income from the prior year’s total of ¥142.35 billion yen ($1.31 billion) and a 13.3% increase from 2019’s revenue of ¥838.6 billion yen ($7.71 billion).

The company said its big sellers during the year were Harry Styles’ Fine Line, AC/DC ‘s POWER UP, Luke Combs’ What You See Is What You Get and This One’s For You, Dojo Cat’s Hot Pink, Polo G’s THE GOAT, Future’s High Off Life, Travis Scott’s ASTROWORLD, The Kid LAROI’S F*CK LOVE (Savage), and Jawsh 685’s Jawsh 585 Releases.

Revenue received a further boost due to releases from the Foo Fighters’ Medicine At Midnight, Miley Cyrus’ Plastic Hearts, and 24KGoldin’s El Dorado.

Meanwhile, Sony Music Japan’s big titles include  Kenshi Yonezu’s STRAY SHEEP, SixTONES’ 1ST, and LISA’s Homora.

Breaking out revenue for the year by segment:

  • Recorded music totaled 516.3 billion yen ($4.87 billion, an increase of 13.2% from the prior year’s total of 467.15 billion yen ($4.2 billion)
  • Publishing grew 2% to 156.9 billion yen ($1.48 billion) from 2019’s total of 157.5 billion yen ($1.45 billion)
  • Visual media/platform totaled 254.1 billion yen ($2.4 billion), or a 21.7% increase over 214 billion yen ($1.97 billion)

As a percentage of revenue, that breaks out respectively to 55.7% recorded music, 16.9% publishing and 27.4% for visual media/platform.

With the latter segment, that means overall music revenue rose to ¥673.1 billion yen ($6.45 billion), or 10.4% growth over the prior year’s total of ¥624.6 billion yen ($5.75 billion).

Within recorded music:

  • Streaming grew 25.1% to ¥337.1 billion yen ($3.18 billion) from ¥276.04 billion yen ($2.54 billion) and now comprises 65.3% of that segment’s revenue versus 59.1% last year.
  • Downloads saw revenue drop 7.2% to ¥31.4 billion yen ($296 million) from ¥34.65 billion yen ($319 million), with its percentage of revenue now at 6.1%, down from 7.4% in 2019
  • That means total digital revenue is now 71.4% at ¥368.5 billion yen ($3.5 billion), versus the prior year when it was ¥310.7 billion yen ($2.86 billion), or 66.5%.
  • Physical increased by 12.1% to ¥97.75 billion yen ($921.26 million)  from the prior year’s total of ¥89.34 billion yen ($821.9 million). As a percentage of revenue in 2020, it totaled 18.9% but that’s down from 19.1% in the prior year
  • Finally other income streams came in at ¥50.03 billion yen ($471.5 million), a 23.6% drop from ¥67.12 billion yen ($617.5 million), due to the impact of the COVID-19 pandemic on the live industry and merchandising. As a percentage o revenue, other income streams comprised 9.7% down from 14.4% in 2019.

Looking ahead, Sony said it expects upcoming releases from BROCKHAMPTON, DJ Khaled, Doja Cat, French Montana, Giveon, Modest Mouse, Nicky Jam, Rag’n’Bone Man, and Travis Scott to drive revenue in its current fiscal year. Further, it forecasts revenue from its music operations and visual media/platform will grow to ¥990 billion yen in 2021.

(This story used an exchange rate of 106.1 yen to the dollar for the annual results for 2020 and ¥108.7 yen to the dollar for 2019’s annual results. For the fourth quarter 2020 the exchange rates quoted are ¥105.9 yen to the dollar and ¥109 yen to the dollar for 2019.)

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