PS5 Reveal Caused PS4 Sales To Fall Below Sony's Expectations

While there's still plenty of life left in the current generation of gaming consoles, there's mounting excitement for next-gen consoles. As part of its latest earnings report, Sony announced this week that PlayStation 4 shipments have climbed to a staggering 100 million units life-to-date worldwide. And while that's a remarkable milestone, the recent trend hasn't been quite as positive--the 3.2 million PS4 systems that Sony shipped in the April-June quarter was "slightly below" the company's internal expectations. The reason for the downturn, according to Sony? The PlayStation 5.

Sony said the lower-than-expected sales were "primarily" due to the company's announcement of its next-generation console, tentatively known as the PS5. Sony has yet to officially announce its next-generation console, but PlayStation architect Mark Cerny started talking about the console and some of its specs earlier this year. After that, Sony demonstrated the console's much-faster loading times during a business meeting. It's yet to provide an official name or exact release date for the system.

It's a historical trend in the games business that console sales of an older system drop off to a degree when a new console is revealed. The thinking is that people hold off on buying a console when they know a newer one is coming. That seems to be what's happening with here with PS4 sales. It's unclear if there are plans for a price cut or anything of the sort to help drive additional sales.

As a result of the lower-than-expected PS4 sales, Sony said it has "revised downward" its forecast of PS4 sales during the current fiscal year ending March 2020. The company is cutting its projections by 1 million units, from 16 million to 15 million.

15 million is still a massive shipment number for a console so late into its lifecycle. Sony said this ongoing success "demonstrates that the PS4 platform is still garnering support from many users."

Sony is also projecting a downturn for game sales during the current fiscal year. The company is lowering its expectations to be flat year-over-year instead of increasing due to lower third-party game sales. Lower-than-expected revenue from free-to-play games was also called out. This may be in reference to Fortnite and other battle royale games that are slowing down when it comes to revenue.

On the plus side, Sony said it expects its "network services" to generate more revenue in the current fiscal year. Overall, Sony said one of its major areas of focus during the fiscal year is on "preparing for the launch of the next-generation platform," in addition to growing the userbase the company already has.

The PlayStation 5 is rumored to launch in holiday 2020, which is also when Microsoft's Project Scarlett next-generation system is confirmed to release.