Sony: Japanese Emperor With Diversified Growth

Stock Market

Sony Group Corporation (NYSE:SONY) is a Japanese-founded, multinational technology titan which has one of the most diversified business models on the planet. The company has continued to grow its solid leadership position across many segments from gaming (PlayStation) to music. In this post, I am going to break down its business model, financials, and valuation, let’s dive in.

Data by YCharts

Diverse Business Model

Sony is a Japanese conglomerate that is a pioneer in the technology industry. Its first product was a simple rice cooker, which the company made back in 1946. In the 1950s, Sony created the highly successful TR-55 Transistor radio, before developing the iconic “Walkman” portable cassette player in 1979. In 1994, the company launched its PlayStation 1 gaming console, which was an icon of its time. This was followed by the PlayStation 2 in the year 2000, which is still the best-selling console of all time.

In 2022, the Sony PlayStation led the gaming market, with approximately 35 million installed consoles. This is higher than Microsoft’s Xbox, which has approximately 23 million installed consoles. From the graphic below you can see Sony (red bar), is forecasted to continue to outpace Xbox (blue bar) in the coming years.

Gaming installed base

Gaming installed base (WePC)

The latest PlayStation 5 model is also outpacing the Xbox Series XSX|S by approximately 6.8 million units as of October 2022. Thus it is clear PlayStation is the leader.

PS5 vs Xbox

PS5 vs Xbox (Vgchartz)

Sony is not just a game console manufacturer, the business has kept its diverse technology roots. Today, Sony manufactures TVs, headphones, cameras, and much more, it is also the brand leader in many of these areas. For example, a leading online sound review website for “best noise-canceling headphones” gives Sony both the number one and number two spot. The Sony a6 series is

Sony Music Songs

Sony Music Songs (Sony Investor filings/MBW)

Q2 Financials

Q2 Financials (Sony)

Game and Networking

Game and Networking (Sony Q2 report)

Sony Music

Sony Music (Q2,FY22 report)

Results by Segment

Results by Segment (Q2 Sony)

Sony stock valuation 1

Sony stock valuation 1 (created by author Ben at Motivation 2 invest)

Sony stock valuation 2

Sony stock valuation 2 (created by author Ben at Motivation 2 Invest)

Data by YCharts

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