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Sony’s gaming division’s profits jumped last quarter despite looming PS5 launch
Sony’s gaming division continues to generate large profits for the company even as the PlayStation 4 era comes to an end. The company announced that it generated 507 billion yen (~ $ 4.9 billion) and 105 billion yen (~ $ 1 billion) in operating profit from the PlayStation division in the third quarter of the year (fiscal second quarter), up 52% and 40% more than for the same period a year ago.
Vjeran Pavic / The Verge
Considering the release of the PlayStation 5 in a couple of weeks, one would expect a significant negative impact on Sony’s financial results in the third quarter, as the company is actively ramping up production, and the new console is not yet generating revenues. Sony did say that its profits were down due to higher costs and revenue because of a predictable decline in PS4 sales.
Worldwide deliveries of PlayStation 4 by the results of the reporting quarter approached 114 million. Over a three-month period, the company delivered another 1.5 million devices to the market, which is almost half the 2.8 million in the same quarter last year. Expected trend ahead of next generation launch.
Ghost of Tsushima is now PS4’s fastest selling first-party original IP debut with more than 2.4 million units sold through globally in its first 3 days of sales.
Congratulations @SuckerPunchProd, and thank you to fans around the world for taking part in Jin’s journey. pic.twitter.com / 6aE4U7YZJH
– PlayStation (@PlayStation) July 24, 2021
However, strong game sales and PlayStation Plus subscriptions seem to have more than made up for the deficit. Sony’s biggest PS4 launch in the quarter was open-world samurai adventure Ghost of Tsushima, which was released in July and sold 2.4 million copies in its first three days alone. Sony says it is the best-selling project in the new universe for the PlayStation 4.
Sony has slightly revised its outlook for games upward, expecting that by the end of the fiscal year (March 31), revenue will be 2.6 trillion yen, and a profit of 300 billion yen. This will be a 26% increase in revenues and profits, which can also be considered an impressive figure.
In the short term, Sony’s revenue is likely to be limited by the number of PS5 consoles it can produce. In an interview with Reuters today, SIE chief Jim Ryan said there is “very strong demand” for the console, with pre-orders in the US in the first 12 hours surpassing PS4’s in the first 12 weeks, he said. “It’s possible that not everyone who wants to buy a PS5 on launch day will be able to find it,” he added.