PS5 is being sold at a loss, but has generated record gaming revenue

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The PS5 is being sold at a loss, Sony has revealed.

Earlier today, Sony published its fiscal year 2020 earnings announcement, revealing several new aspects of the PS5's sales. One of the more interesting details is that Sony is actually selling the PS5 at a loss, as revealed by the "loss resulting from strategic price points for PS5 hardware that were set lower than the manufacturing costs" point on a slide midway through the presentation.

It's an interesting reveal in a presentation filled with plenty of noteworthy details. Elsewhere, Sony revealed that 7.8 million PS5 consoles have been sold at the conclusion of the 2020 fiscal year as of March 31, surpassing the 7.6 million PS4 units sold within the same time period.

Additionally, it's PlayStation's biggest ever year thanks to chiefly to the sales of the PS5. As you can see in the tweets from Niko Partners analyst Daniel Ahmad below, Sony's Game and Network figures mean that the company has finally broken the cyclical profit/loss cycle that has existed in the department since the launch of the first PlayStation.


It's not all good news, though. During an investor call following the briefing (as transcribed by VGC), Sony CFO Hiroki Totoki said that it's unlikely PS5 stock will drastically improve by the end of the current fiscal year, which ends for Sony on March 31, 2022.

"As I said earlier, we’re aiming for more sales volume than the PS4 [during year 2]. But can we drastically increase the supply? No, that’s not likely," the CFO said. "The shortage of semiconductors is one factor, but there are other factors that will impact on the production volume. So, at present, we’d like to aim at [beating] second year sales of 14.8 million, which was the second year of PS4," Totoki concluded.

Last year, Sony set some pretty high targets for the PS5's lifetime sales. The company is currently aiming for the next-gen console to beat the PS4's lifetime sales of over 100 million units, which is no small task, considering the monumental sales figures of the latter console.



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Source: https://www.gamesradar.com/uk/ps5-is-being-sold-at-a-loss-but-has-generated-record-gaming-revenue-for-sony/

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