Sony's game division loses $45 million

Technology giant's PlayStation sector posts loss in first quarter due to lower sales of PSP and PS3 hardware and software; company loses $313.9M in total.

Sony's game division posted an operating loss of ¥3.5 billion ($45 million) for the company's first quarter ended June 30, the Tokyo technology titan announced today. Revenue for the period took a 14.5 percent hit, dropping to ¥118 billion ($1.5 billion). Sony said this downturn was a result of lower sales of hardware and software for the PSP and PlayStation 3, as well as the impact of "unfavorable" foreign exchange rates, compared to a year ago prior.

Sony is seeing red.

As for hardware, combined sales of PlayStation 2 and PS3 units during the period came in at 2.8 million, down from the 3.2 million the company sold this time last year. PSP and PlayStation Vita combined sales hit 1.4 million units for the period, a decline from the 1.8 million sold last year.

Concerning software, sales in this sector were down, too. Combined PS2 and PS3 software sales reached 20.1 million copies for the period, a decline from the 27.6 million sold a year ago prior. The PSP and PS Vita accounted for software sales of 5.8 million units, down from the 6.6 million recorded this time last year.

Sony does not foresee its portables turning around anytime soon. The company said portable hardware sales are expected to be "significantly lower" than what it had previously forecasted, due to the decrease in sales for the first quarter and poor foreign currency exchange rates. Additionally, Sony said operating income is expected to decrease "significantly" year-over-year.

As for Sony's business as a whole, the company posted revenue of ¥1.52 trillion ($19.4 billion) for the period, up 1.4 percent year-on-year. Losses totaled ¥24.6 billion ($313.9 million), an increase over the ¥15.5 billion ($197.8 million) hit the company took this quarter last year.

[CORRECTION] An earlier version of this story incorrectly translated yen to US dollars in one instance. GameSpot regrets the error.

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0 comments
xboxps2cube
xboxps2cube

i got up out my bed to say this... first of all any of you guys talking mess about any of the game companies are fool.  Competition is good, if it wasn't for competition we would never get good stuff. Imagine if sega didn't make the genesis, saturn or dreamcast, and only nintendo dominated the gaming world only we would be in trouble. imagine a world without competition.... imagine... madden like systems every year with no major  improvements because you can only buy one system.... thats what EA did to football, why would you want any of these companies to fail?  I admit im no nintendo fan since n64 and im not really a microsoft fan... but microsoft kicked off the next gen and if it wasn't for them the competition would of dragged it's feet, same goes for sega during the dreamcast days... IMO i felt like sega gave up too early on their system...  what im saying is we wouldn't be where we were if it was a one man show..

jamesmichealtil
jamesmichealtil

thats what happens when you chop & change a games console around & make two many versions of it.

 

The biggest mistake  was taking away its ability tot playback PS2 games the  second PSN hack was another along the removal of OS & 3d playback which was only any good if you could afford a 3d tv and enjoyed your games at  lower frame rate.

 

So Sony bare this in mind for the PS4  Design so it plays the whole family of PS games 1-4 it has a 2TB hard drive a region free global online store & less geeky Apps Like BBC i player  & at an affordable price to

dmdavenport
dmdavenport

This isn't just Sony's problem. Every company making products in Japan is getting punished by the exchange rate. Unless they move their manufacturing off Japan, their products will be too expensive for the global market. No one will pay $600 for a PS4. 

interrasteral7
interrasteral7

I know I am off topic, but in my opinion, I feel like Sony has completely ditched the sixaxis with most of their exclusive video games. It is good that they support the rumble, but they could at least include more uses in their exclusive video games to the sixaxis as an optional play instead of being forced to play the video game with it. I hope even the third party developers develop more use with the sixaxis as well.

SS_Gokou
SS_Gokou

Wow... Sony blaming PSP sales while in reality they dropped it too early in the US. Another reason why Vita had low sales because people know what they did with the PSP.

Flames1976
Flames1976

Wow everytime you turn around now all you see with sony is their losing money.Hard to believe they would even try another console after the PS3 and vita.

Spacerac
Spacerac

I think the main reason the Vita isn't selling as well as it could be, in addition to not having many games in it's early life, is the precedent set by the 3DS. People didn't buy the 3DS, so in response Nintendo dropped the price and 3DS sales skyrocketed. The same people see this and say "hey, if I don't buy the Vita, the price will eventually drop." The logic isn't faulty at all, even if it's not likely to happen.

theKSMM
theKSMM

A global recession and an unfavorable exchange rate will undoubtedly hurt profits. But Sony is being hurt by slowing demand for their products as well.  I found it surprising how much the PS2 was still buoying their sales even as recently as last year.  Now the PS2 is in steep decline, the PS3 is in a slower decline (but a decline nonetheless), and the PSVita hasn't picked up enough to cover the decline in PSP sales.  Combine that with few must-have "Only on PlayStation" games and you have a recipe for a bad fiscal year.  Sadly, I don't know if things turn around without a substantial price drop somewhere in their product line.

Jinzo_111887
Jinzo_111887

Anyone else get the feeling their new anti-consumer policies are part of the reason their profits?

jtthegame316
jtthegame316

good i like seeing things like this when it is about a companies like sony now if i could see this happen to ea i would be over the moon.

Serious
Serious

With the economy the way it is. I'm not surprised. However I feel that the rumors of Playstation 4 and a Playstation Vita price drop have many of the gamers wondering if now is the time to get a PS3 or Vita or wait.

deadmonkey76
deadmonkey76

I am not at all supprised by this. I sold my ps3 because the way sony treated me first off they removed install other operating system that I was using with an update saying it is to prevent hackers alot of good that did the only person who was effected was consumers who bought an overpriced system and I was never remburst then they change eula whenever they feel like it to suit there best interest not ours every time I go to play a game there is a patch that takes 10 to 30 minutes to download or the online service is down. Infact I went to buy a new tv I did not even bother with sony since there tvs are actualy not as good as they used to be and I would never buy another sony product I went with a panasonic 3d plasma tv vt20 and it blows sony xbr out of the water so screw sony I dont feel bad one bit and will never give them a dime of my hard earned money

xxEmber2Inferno
xxEmber2Inferno

It is true that the economy is down right now, which explains the lower sales of Sony's other electronics as well as video games, but the PS3, 360 and Wii were all more expensive than the last generation. Buying a 400- 600 dollar device knowing that you are going to spend thousands more on games and terrible day after DLC is hard to do in any economy. Gaming has always been a bit expensive but the days of the N64 and PS1 are gone. I could go to a walmart, kmart or any store and buy a game off the shelve and the quality was always there. It was worth the price of release back then. People forget that innovation in gaming used to be about weird concepts and fun experiences, not how much like a game is like or unlike Call of Duty or Halo.

bakasora
bakasora

Does Sony have a goldmine? I keep seeing Sony posting losses on most sector but they are still moving on.

kmaoO
kmaoO

Sony posted losses for the last 10 years now... hummmmmmmmmmm

jark888
jark888

We don't buy products because they are Sony's. We buy them because they are the best in terms of quality and price that match our needs. Please treat consumers like they are humans being, not like donkeys.

itchyflop
itchyflop

the move function on the ps3 is a little sluggish in response, and i dunno why they didn't include a golf game on sports champions (like another popular game company did with their copy cat wii version) instead of the frisbee!! Vita will hopefully have some quality releases next year, ps3 is now in its final stages of its life we will see some last gen games now the developers have gotten to know the system this is when the awesome games will arrive, that should help new sales, before the most anticipated ps4 arrives (and we are wild stallions!!).

Cozm1kaos
Cozm1kaos

All Sony needs to do is release more excellent games for the vita, keep the price tag the same and lower the cost of the memory. This move alone will bring them back up.

KBFloYd
KBFloYd

yup....gaming went downhill after kinect and move came out....over saturated the market with gimmicks...no one cares about gaming as much as they did a year or 2 years ago.lets hope the wiiu will spark some interest in gaming again. 

Bleak5170
Bleak5170

 @bakagami 

 

   Wow, do you even read the articles you link to? Microsoft's Entertainment and Devices Division, (which includes gaming), had it's biggest growth.

Bleak5170
Bleak5170

 @dmdavenport 

 

   I actually believe millions of people would pay $600 for a PS4. However I have this feeling that both next-gen consoles, (not including the WiiU), will be much more reasonably priced than their predecessors were when they launched. They pretty much have to be with the decline in console gaming and the struggling economies around the globe.

itchyflop
itchyflop

 @Flames1976 they always loose money on their hardware where as Nintendo don't and use clever marketing to sell a novel yet dated product for example the WII (originally Sony's idea for the move pinched by Nintendo) had average ps2 almost graphics chip and scart res only but because the market hadn't really seen anything like it before (excluding the dream-cast's fishing rod), or hadn't been marketed right before !!! hands up to Nintendo, they always somehow seem to get it right and at a profit from the begin inning, though without risk takers like Sony or Microsoft the hardware wouldn't progress as quickly as it has. Each has there own style of play and feel too, personally i love my ps3, but miss halo or Mario big time :)

interrasteral7
interrasteral7

 @Spacerac

 In my opinion, I think Sony might not need to drop the Playstation Vita's price down as long as they have enough good video games for it. Right now the number of video games they have on the Playstation Vita are limited just like when the Playstation Vita launched.

Spacerac
Spacerac

And yes, the price of the memory cards IS prohibitively expensive.

Spacerac
Spacerac

 @jtthegame316 Yes, it's great seeing all the little people underneath a big faceless corporation losing money.

Zerabp
Zerabp

 @Serious Which is sad as it's making the 720 and PS4 rush development instead of taking their time to finish their goals of a 9-10 year cycle.

itchyflop
itchyflop

 @swamptick i agree but a lot of work is to be done to before they can a) bring the price down for home use b) make it more user friendly. it ll be a few years i think. Good comment !! :)

Zerabp
Zerabp

 @Cozm1kaos The cost of the memory is the reason I don't have a vita yet, so yeah hammer meat nail.

rolla020980
rolla020980

 @Cozm1kaos Perfectly said. Sony is way out of touch with what Vita owners outside of Japan want. Every time they mention the poor sales figs, they blame anything but themselves. I mean its an amazing handheld with huge potential but no software support and gouge-level pricing on memory.

bakagami
bakagami

 @Bleak5170 as I stated above (apparently you have tunnel vision) the purpose of these links is to point out that even Microsoft, a company that has run in the black since it was founded, is struggling in this hard economy. Jesus, I hate having to repeat myself

Spacerac
Spacerac

 @interrasteral7 Right now 8GB cards are bundled with 3G systems, and the cards should be bundled with all of them. Once that gets out I think the systems will sell more. The memory is also hindering people as well.

jtthegame316
jtthegame316

 @Spacerac Don't twist what i was saying. what i was saying is its good to see greedy corporations lose. sony do things that are pure greed like instead of making there devices use sd like everything else they make there own format of card exactly the same and charge more. sony is greedy and EA is even more greedy which is why i happy sony are at a loss and i would be over the moon if ea were at a loss because they are the the greediest corporation ever.

TheArcade
TheArcade

 @itchyflop

We are

We are VR

Troopers Trio Virtual Reality

Troopers Trio Virtual Reality

 

;)

Monsta1217
Monsta1217

 @Zerabp i feel exactly the same way i have the vita but have yet to buy a memory card because the one i want cost an arm....literally an arm lol

itchyflop
itchyflop

 @rolla020980 man i must be on the Epiphany page !! well said  !! the software is too expensive, 45 quid for fifa 11, ITS LAST YEARS, and there's no price decrease either, unless you wanna play psp original games, errr no thanks. id pay 30 quid...

bakagami
bakagami

 @IIIIDiAbLoIIII the idea was to point out that even Microsoft, a company that has run in the black since it was founded, is struggling in this hard economy. But I suppose that's just not as much fun as saying that Sony is failing, right?

bakagami
bakagami

 @Spacerac agreed, and they need to make it easier to switch the cards out too. every time I swap cards I have to wait like 2-3 minutes while the system re-initializes the database and then all of the icons are all scrambled.  The problem I have with the Vita as an owner is how much control they take away from the end user. I know its supposed to prevent piracy and all that but they don't need to close the system so much.  you don't need to make piracy impossible, you merely need to make it difficult