Sony Pictures, the studio whose recent releases include T2 Trainspotting, Sausage Party and Passengers, has announced a dramatic revision of future profit in its film division.
On Monday, a note from CEO Kazuo Hirai and Sony Entertainment CEO Michael Lynton read:
Today Sony Corp. announced that a goodwill impairment charge for the pictures segment of ¥112.1bn (approximately $962m) was recorded as an operating loss in the third quarter ending 31 December 2016.
The statement continued:
The impairment charge resulted from a downward revision in the future profitability projection for the motion pictures business within the pictures segment. The downward revision was primarily due to a lowering of previous expectations regarding the home entertainment business, mainly driven by an acceleration of market decline. Underlying profitability projections of film performance were also reduced, but the adverse impact of that reduction is expected to be largely mitigated by measures that have been identified to improve the profitability of the motion pictures business.
The studio has struggled in recent years: in 2016, just one of its releases – Paul Feig’s Ghostbusters reboot – landed in its all-time Top 50, with a $128m global take. The previous year, two releases, Skyfall and Hotel Transylvania 2, charted in its Top 20.
Sony also suffered from an email leak in late 2014 that revealed a number of insider details that embarrassed the studio. Revelations about the salaries of the female leads on American Hustle reignited the gender pay gap debate in Hollywood.
The leak was claimed by North Korea, in response to the lampooning of its leader in Seth Rogen comedy The Interview. That film took $11m worldwide, although home entertainment and pirated copies did well.
