Sony: Weak games division depresses business results
The PS5 production bumps, game hits are currently rare: Sony’s games division is ailing, the profit forecast has been lowered.
Sony’s current business figures are suffering from the weakening games division: The Japanese group’s top-selling division lost 37 percent in profit in the past quarter compared to the previous year.
According to the annual report, Sony was able to increase its total profit by about ten percent to 218 billion yen (about 1.6 billion euros). For the current fiscal year, however, the Playstation manufacturer had to lower its profit forecast: The electronics group now only expects a profit of 800 billion yen for the fiscal year running until the end of March, almost 10 percent less than previously estimated.
blockbuster lull
The main reason for the lowered forecast is Sony’s gaming division, which fell short of expectations. On the one hand, this is due to a weak gaming year for Sony: Blockbuster games from the Playstation manufacturer were rare this year. Aside from the “Horizon Forbidden West” released in February, Sony has only released the racing game “Gran Turismo 7” on the market so far. Meanwhile, the cost of developing future games has risen. In November, the action game “God of War” could provide a new boost.
In addition, Sony explains the decline in profit and sales compared to the previous year with the corona crisis: In 2021, more games were played overall than in the current financial year due to stricter contact restrictions.
In the console business, Sony is still unable to meet demand: the Playstation 5 is not being manufactured fast enough to satisfy the game fans’ desire to buy. The company has regularly missed previous production targets. After all, 2.4 million new PS5 consoles were produced and sold in the last quarter, but Sony will not be able to keep to the annual target of 18 million consoles sold at this rate.
Sony’s business with hardware products, i.e. audio/video equipment, mobile phones and televisions, was also somewhat weaker than in the same quarter of the previous year. The turnover of the second strongest Sony division fell by 24 billion yen, the profit shrank to 53 billion yen. On the other hand, the company was able to increase strongly in its film segment Sony Pictures, whose profit doubled from 25 billion yen to 50 billion yen.
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