almost 2 years ago • 3 mins
Sony reported record full-year sales on Tuesday, as the entertainment giant came to the eye-opening realization that three Spider-Men are more profitable than one.
What does this mean?
Somewhere in this sprawling multiverse, there’s another Finimize reporting that Sony is in disarray after its latest Spider-Man movie unceremoniously flopped. This is not that universe, with Spider-Man: No Way Home having become one of the highest-grossing movies of all time. Throw in a long list of licensing agreements with streaming services, and Sony’s movie segment brought down the house last quarter.
Sony’s music and anime businesses performed well too, and there was big demand for its smartphone camera sensors. Put it all together, and the company posted its best-ever full-year sales – albeit with the caveat that the company’s profit came in 14% lower than the year before. It said it was expecting another drop of 6% this year too, which does make you wonder if Hotel Transylvania: Transformania was a shrewd investment.
Why should I care?
Zooming in: Microsoft might not be on top for long.
Sales of Sony’s PlayStation 5 faltered last year, but only because it’s still nearly impossible to get hold of one: the company doesn’t have enough of the parts it needs to meet demand. That’s put its sales well behind those of Microsoft’s Xbox models, which made record revenue in March. Sony, then, has been working hard to find new suppliers and design shortcuts, which it’s confident will help it get production back on track in next to no time.
The bigger picture: Sony’s built for this.
Sony makes a significant portion of its sales internationally, which is a fortunate position for a Japanese company to be in right now. See, the yen is at a 20-year low against the US dollar, largely because America’s rising interest rates (and Japan’s rock-bottom ones) have made US assets more appealing to international investors and savers. So when Sony converts its foreign revenue back into Japanese yen, it’ll be worth a lot more than it would’ve been otherwise.
Keep reading for our next story...
Pfizer announced plans on Tuesday to buy Biohaven Pharmaceutical in its biggest deal in five years.
What does this mean?
Pfizer’s facing an uphill battle going forward: sales of its Covid vaccine are expected to peter out sooner or later, and some of its biggest-selling cancer drugs are due to lose patent protection in the next few years. So the company’s putting some of its hard-profiteered cash to good use, having already bought drugmakers Trillium Therapeutics and Arena Pharmaceuticals late last year for around $2 billion and $7 billion respectively. It added to that roster on Tuesday, announcing plans to buy Biohaven Pharmaceutical in a deal worth almost $12 billion. The move will give Pfizer access to a migraine drug that brought in nearly $500 million in revenue last year, and is projected to bring in $1 billion by 2024.
Why should I care?
For markets: Patience is a virtue.
Pfizer’s putting up almost $149 for each of Biohaven’s shares – a hefty 78% more than they were worth before the deal was announced. Those kinds of premiums are a pretty standard way to convince the target’s shareholders to accept the deal, but Pfizer may have actually nabbed a bargain: Biohaven’s stock was trading at $143 as recently as mid-February.
The bigger picture: Better late than never, Novavax.
If Pfizer is the drugmaker that got the vaccine party started, Novavax is the one that turns up at midnight with a bottle of schnapps: the company reported its first profitable quarter this week, as its vaccines finally rolled out across the world. The company was part of the US-backed race to develop a vaccine in 2020, but it missed out to the likes of Pfizer and Johnson & Johnson. Now, though, Novavax is hoping that its more traditional technology will appeal to holdouts, as though antivaxxers were only ever a protein-based solution away from civic-mindedness.
Disclaimer: These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment advisor.