Nintendo's Stock: Values Keep Rising

[VideoGameAccountant]

Teeqoz said:

VideoGameAccountant said:

 

And, again, the issue with Sony as a whole is, outside of gaming, there isn't much room for growth. Sony TVs lag. The movie business keeps having flops. Sony doesn't have a competitive phone and businesses like semiconductors have been losing money. Compare this to Nintendo where the company has improving earning, outstanding liquidity, and more opprotunities to make money by licensing their huge array of IPs. 

I am getting off topic a bit, but the problem you have is you assume some businesses making money means that Sony ins't reliant on games for growth and earnings. Financial Services, as I mentioned, should be considered its own thing(I think the historical data breaks it out), a few businesses make some profit and a lot of businesses are lagging and dragging everyone else down. Gaming is mentioned because it makes a lot of money and its an industry Sony is very compatitive in (best selling 8th gen console). This is what everyone means.

Except I don't lol. I have said repeatedly in this thread that gaming is a very important segment for Sony, and that it will become the highest earning segment soon.... it's kind of amusing to read this because you are literally assigning me thoughts and positions which completely reject what I've actually written in the thread.

As for how literal Wyrdness was, I can't be sure, but judging from his posts in this thread (including this statement: ""Sony's other business ventures right now are a sink holf for money from their electronics, phones and even movies are on shakey ground.") To me, they illustrate a thorough misunderstanding of what Sony's situation actually is and has been. But maybe I'm just taking him too literal and he's being overly dramatic, but somehow, I don't think what Wyrdness meant when he said "all their money solely comes from the PS side of things right now" was actually "About 25% of the total positive operating income comes from Playstation".

Also, this was never a discussion about wether Sony or Nintendo should be higher valued lol, so I don't know why you're trying to convice me of that. Never argued that.

Your arguments have been "Look, other divisions make money, so it's not just gaming." At the same time, you message the numbers to fit your conclusion. Look at the bold. Only 25 percent of Sony's operating income comes from Playstation (its more like 30). So of Sony's 10 or so divisions, 1 is making a quarter of the operating income for the company as a whole. And to the guy you originally quoted, if Playstation has a bad year and has a lose, that sends Sony's straight into the red. No other division could do that. And if finance is a subsidiary, it means the income Sony is reporting is not the true cash flow they are getting. If the pay out is 50 percent, then the actual money Sony is getting could be as little as half of what is reported in the slide you showed earlier. If you remove finance, Gaming makes up about 38 percent of all operating profit (of the profitable divisions). And this says nothing to the fact that numerous divisions are losing money.

The problem is you see trees but not the forest. You point out that other divisions are making money but don't look at them as a whole. The only division that is competitive with Gaming, in terms of both profit and revenue, is Finance and if this is a sub it means Sony only gets what they pay out in dividends. In terms of growth, the only divisions with growth in both revenue and operating income was Gaming and Finance, and Gaming has far stronger growth. 5 divisions had a decline in revenue. Look at this in comparison to net income. Sony only made 73 billion yen for FY 16. Music's operating income was 75 billion. If it had a net loss, earnings could still be saved if slack is picked up by other sectors and they have a good year. Gaming, on the other hand, made 135 billion yen. If it went in the red, the company would be in serious trouble. This is also bad when you consider Sony's has historically sold their systems at a loss and they'll need to release the PS5 before too long or lose out to Nintendo and the growing PC market. 

Your original comment was that "The narrative that the only segment of Sony currently doing well is Playstation is quite wrong." When you look at growth and total revenue/profit, that doesn't seem to be the case.

(as an aside, I think Hedra's point on dividend payout was good)

 

If music has a bad year, the company will be fine. If gaming has a bad year, it means Sony's financial results (and its stock price) will be a disaster. You say everyone else misunderstand's Sony's possition but you never considered that gaming is what is driving the company's profits.