02.02.2022

Sony Quarterly Report: revenue over $7 billion, falling game sales and PS5 supply problems

Sony’s gaming division shared its results for the third fiscal quarter (ended December 31). Despite generally good performance, sales of games and hardware have fallen. The company is unable to cope with the demand for the PS5, which now lags behind the PS4 in terms of the number of devices sold over the same period.The main thing from the financial report

Revenue of the gaming division fell by 8% year-on-year and amounted to ¥813.3 billion ($7.11 billion).

  • This is due to a decrease in sales of consoles and peripherals, as well as third-party games and their own titles.
  • Operating profit, on the contrary, increased by almost 15% and amounted to 92.9 billion rubles ($810 million).
  • The main growth factors were the reduction of commercial and administrative expenses, as well as losses due to deliberate understatement of prices for the PlayStation 5.Revenue from the sale of PS4 and PS5 amounted to ¥201 billion ($1.76 billion), which is 18% less compared to the same period in 2020.
  • Sony earned ¥461 billion ($4.03 billion) on the sale of games — 5% less in annual terms.
  • Of this amount, most of it came from additional content — ¥250.4 billion ($2.1 billion).
  • This is followed by digital copies of games — ¥181.8 billion ($ 1.58 billion), and then physical copies — ¥29.5 billion ($ 258 million).Sony gaming division revenue for the third quarter and adjusted forecast for the entire fiscal year 2021

In the third quarter, sales of games for PS4 and PS5 amounted to 92.7 million copies.

  • Of these, 11.3 million are titles from internal PlayStation studios.Gaming services (PS Plus, PS Now and advertising revenue) brought Sony ¥102.5 billion ($895.7 million) — an increase of 7% year-on-year.
  • The rest of the revenue is PlayStation VR sales and revenue from the sale of its own games outside of PlayStation.
  • This segment brought Sony ¥47.3 billion ($413.8 million), which is 35% less in annual terms.By the end of 2021, Sony managed to ship only 17.3 million PlayStation 5.
  • For comparison, the PS4 has sold 20.2 million units in the same period since launch.Because of this, Sony had to lower its forecasts for the expected shipments of the PS5.
  • Now the company plans to release only 19.3 million of its new consoles by March 31, 2022 (instead of 22.6 million). All this is explained by a strong shortage and problems with the production of devices.Indicators for the calendar year (January 1 — December 31, 2021)

In 12 months, Sony’s gaming division earned $24.87 billion — an increase of 8.9% compared to 2020.

  • According to analyst Daniel Ahmad, the mobile division of the company belongs to the music department.
  • If we add Aniplex studio’s revenues to the total gaming revenue, then the total revenue will be $25.96 billion.Operating profit amounted to $2.63 billion, which is 21.3% less in annual terms.
  • This is an expected decline, given that 2021 was the first full year of the PlayStation 5’s life.A look at Sony’s Game & Network Services segment from a calendar year perspective.

The number of subscribers of the PS Plus service has reached 48 million.

  • The number of active players who use PlayStation online services on a monthly basis now stands at 111 million people. Thus, 43% of the entire audience pays for a subscription every month.The total number of games sold for the 2021 calendar year was 294.1 million, which is 14.2% less in annual terms.
  • At the same time, the share of digital copies was 67.5%.The number of games sold from internal PlayStation studios for 12 months amounted to 37.3 million copies.
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