Sony Sold Record Number of PlayStation5 Consoles but Slashed its Full FY23 Outlook

Record PS5 Shipments

Sony's main revenue generator is the Games & Network Services segment, which grew by nearly 16% y/y in the quarter ended December 31 (Q3 FY23), according to today's results. It brought in around ¥1.44 trillion (around US$ 9.58 billion), boosted by record PlayStation5 sales of 8.2 million units. [1]

PS5 was released in late late-2020 and now cumulative sales have reached 54.8 million and Its main competitor is Microsoft's Xbox X & S. The US tech behemoth does not disclose exact figures but Xbox hardware revenues rose 3% in the December quarter, according to CFO Amy Hood [2].

It is generally considered that PS5 is vastly more popular though. Video gaming company Take-Two Interactive estimates that 77 million Gen 9 consoles were sold as of December 31 [3], with Xbox and PS5 being the pillar of this most advanced generation. This estimate suggests that Sony has sold twice as many consoles as its competitor.

Not all is rosy for Sony though, as the firm lowered its guidance for the division's full Fiscal 2023 (ending in March) to ¥4.15 trillion (from ¥4.36 trillion), due to lower hardware shipments [4],. The firm was expecting to sell 25 million PS5s this year, but in the previous earnings call, executives had warned that this is a "high target and not within easy reach" [5]. Today, they slashed the forecast to 21 million units. [6]

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After multiple regulatory hurdles, Microsoft recently completed the $69 billion acquisition of Avtivision, publisher of hit games such as the Call of Duty series. The move could change the landscape and undermine Sony's dominance. CEO Satya Nadella said last month that the Activision deal has "hundreds of millions of gamers to our ecosystem". [2]. To please authorities, Microsoft committed to continue offering the marquee game to competitors, including Sony. [7].

Nikos Tzabouras

Senior Financial Editorial Writer

Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.

With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.

References

1

Retrieved 14 Feb 2024 https://www.sony.com/en/SonyInfo/IR/library/presen/er/pdf/23q3_supplement.pdf

2

Retrieved 14 Feb 2024 https://view.officeapps.live.com/op/view.aspx

3

Retrieved 14 Feb 2024 https://ir.take2games.com/static-files/f3fdf5c5-663b-4ac2-8924-d63dc410c60a

4

Retrieved 14 Feb 2024 https://www.sony.com/en/SonyInfo/IR/library/presen/er/pdf/23q3_sonypre.pdf

5

Retrieved 14 Feb 2024 https://www.sony.com/en/SonyInfo/IR/library/presen/er/pdf/23q2_qa.pdf

6

Retrieved 14 Feb 2024 https://www.sony.com/en/SonyInfo/IR/library/presen/er/pdf/23q3_sonyspeech.pdf

7

Retrieved 24 Jul 2024 https://twitter.com/BradSmi/status/1680579462369353730

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