Sony Corp (NYSE:SNE) has disputed rumors that it was planning on merging its film and gaming divisions. The rumors, which first surfaced in a report in the New York Post were described as baseless and mere speculation by a spokesperson of Sony.
“This is nothing but baseless rumor and speculation. There are no plans to for Andrew House to oversee Sony Pictures,” said a Sony spokesperson.
Gaming division is the crown jewel
In the Post article, it was claimed that the reasons for the restructuring were motivated by the dwindling performance of the film division which was in contrast to the gaming division, which is thriving. The move would have resulted in Andrew House, who heads the gaming division, to take on an oversight role over the film division. Sony Interactive Entertainment is itself a result of a merger between Sony Network Entertainment and Sony Computer Entertainment.
In terms of box office receipts, Sony’s film division so far ranks at number 5. The gaming division has been performing well and brought in revenues of $6.4 billion in the first half of the year. In the same period, operating profit was $624 million. Sony Pictures on the other hand floundered. It recorded revenues of $3.7 billion in the first half but then ran an operating loss of $74 million.
Gaming reaches a new level
The figures are likely to be better in the second half given the strong performance of the Sony brand during the Thanksgiving holiday and weekend shopping bonanza. Immediately after the Black Friday sale, Sony Interactive Entertainment disclosed that it had sold over 50 million units of the PlayStation 4 gaming console. Sony also recently launched a virtual reality headset whose popularity will be tested during this festive season.
The merger reports also indicated that Michael Lynton, Chief Executive Officer of Sony Pictures Entertainment as well as Sony Corporation of America, was preparing to leave, possibly to teach or for an executive position abroad.
Sony Corp fell 0.95% in Monday’s trading to close the day at $29.12 a share.
