PS5 Misses Sales Target, But It's Still Up Big Compared To 2022

Sony's latest quarterly report included some bad news for the company, marked by a 31% drop in operating profit from April to June. Though PS5 sales fell below expectations, Sony still says that it expects the console to sell 25 million this financial year, which would be a record for the console. (Current sales for the console are more than 40 million).

Regarding the 3.3 million PS5s sold in the last quarter, Sony management said, "This amount is somewhat less than the expected progress toward our fiscal year sales target of 25 million units, but, due to promotions begun in July, we are seeing an improvement in the momentum of sales."

Sony added: "We have positioned the accelerated penetration of PS5 hardware as one of the highest priorities in this fiscal year, and we will try to work steadily to implement necessary measures to achieve our hardware sales target of 25 million units."

Sony pointed to shortfalls in its movie business and a general downturn in the smartphone market as major causes for this slump. The company has forecasted a 10% decline in operating profit for the year, so this bad news doesn't exactly come as a surprise. Sony is one of many large companies impacted by the ongoing SAG-AFTRA and WGA strikes, which have essentially stalled the movie and television business in their tracks.

From April to June, Sony sold 3.3 million PS5s, which is up 38% year-over-year. This is a major part of why the company is forecasting a banner year for the console, which has so far outsold its major competitor, the Xbox Series X. Analyst Piers Harding-Rolls of Ampere Analysis told CNBC that these better PS5 numbers were a reflection of the console's improved availability compared to previous years. They also cited a number of hit games. "Major third-party releases such as Diablo IV and Final Fantasy XVI helped drive revenue forwards in the quarter," they said in part.

Sony's report also included vital numbers for their business, including 56.5 million games sold, and 108 million monthly active users. That's compared to 47.2 million games sold and 103 million monthly active users for the same time period in 2022. Sony's game division also posted a major increase, with overall sales increasing 28% year-on-year to a total of 167.8 billion yen.

In previous earnings reports, Sony has indicated that it's looking beyond its console business, stating that the company plans to earn $450 million from PC games alone over a 10-month period starting in May. It's also worth noting that the PS5 is still lagging behind where the PS4 was in its lifespan up to this point, but that can be attributed in part to the supply shortages earlier in the current-gen console's lifespan.