PS5 shipments top 54.8 million as of December 2023. Has outsold Xbox Series X/S 2-1, data suggests

[Evilnemesis8]

Sony should have abandoned EA, Ubisoft, Take 2 and Square to release their AAA games on PC and that's it? Sony is not the only ones making demanding games. The whole industry will just die if consoles are not powerful enough to run these games.

I don't know if you've noticed, but people are losing their jobs at a record pace right now, we're in there.
PS5+XBS is going to end up below PS4+XBONE at the current trajectory given by both PS and MS in their early guidance for next FY unless the situation reverses(highly unlikely)
The premium console segment will shrink this generation and the primary reason is going to be the cost of the consoles.

Publishers are going to have to be more proactive about putting their games on the Switch 2 if they want to maintain the kind of revenue they're all projecting.

Denial is thinking that missing a sales forecast by 4M units is ok since it was ambitious.

No, they missed it because they fucked up with nothing last year other than Spider-Man 2, while releasing a handful of PC ports.

It finally caught up with them, and Jimmy retired just in time to not have egg blow on his face

He didn't retire, PlayStation would've had those forecasts and seen what was to come since summer.
Totoki came down from Sony Corp as interim leader because they showed the door to Jim.

I felt bullish about PlayStation in spring, but that was then, things are different right now.

 

[Danja]

That's not an answer to my question. This isn't about relativity. This is about what console do you know of in the past or present where 21M units sold in a FY isn't a big success?

The PS5 there's your answer.

 

[lynux3]

The PS5 there's your answer.

Seems pretty impressive!

 

[Puff]

 

[Danja]

Seems pretty impressive!

First full year of supply and they missed targets is not impressive

But the writing was on the wall when they had that 3.3 million quarter last summer. When you treat the people who made you who are as second class citizens eventually they go elsewhere.

 

[Evilnemesis8]

COO and CFO of Sony has no chill, holy fuck.

Totoki saying it plainly, they're spending too much for too little returns.

 

[Danja]

As expected this man will be the final nail in the coffin.

 

[Evilnemesis8]

Full Quote from Gematsu:

"Actually, I am the chairperson [of SIE]. It's been about four months, and I am trying to demonstrate leadership and trying to have as many meetings as possible with the management team. I also visit studios and everyone is working really hard to fulfill their responsibility to try to optimize the business, and I understand that. But overall growth and sustainable profitability or increasing margin, how will that translate to these goals? I don't think people understand that deeply. I think that is the problem of the organization. So as far as I'm concerned, I try to understand what is happening in the company, in the industry, and also in the perspective of the analysts, and try to explain in a transparent manner so that people can recognize and notice these issues so that we can have a harmonized approach going forward. That is a very general comment since I became the chairperson. There are concrete points which I will not go into today.

"Now, about visiting the studios, and I've had meetings with the leaders there, the studios. People who work in the studios have very high motivation. They're very highly motivated. They're very good people. And they're very creative people. They have great creative minds. And they also have knowledge about live streaming. However, having said that, when it comes to the business itself, I think there is room for improvement. And that's got to do about how to use the money or about the schedule of development or how to fulfill one's accountability towards development, et cetera. Those are my frank impressions. So I will continue to engage in dialogue with the people so that we can find the right way to proceed."

 

[Yurinka]

Quarterly results:

• Record Q3 revenue for any console maker in gaming history
• Record 12 months trailing revenue for any console maker in gaming history
• Record quarter for PS5 hardware sales with 8.2M, now accumulaed sales 54.7M
• Record software sales (game sold) quarter for any console maker in gaming history
• Record addon sales (DLC/IAP/passes) quarter for any console maker in gaming history
• Record game sub revenue quarter for any console maker in gaming history (+11% YoY)
• Record hardware revenue quarter for PlayStation history (maybe any console maker too, but have to confirm the peak Switch and Wii+DS years)
• Record revenue and operative income estimates for the full FY, even if they slightly lowered their revenue estimate
• Hardware up 15.49% YoY, 67.35% QoQ (launch aligned 2.3m under PS4)
• PS5 shipped 8.2m this quarter, 16.4M this FY so far
• 1st party software outside PS for the FY so far 16.54% up YoY (adding Q4 with Helldivers it's going to be massive)
• Record PSN engagement: PSN 123M MAU
• Record PS engagement: total play hours +13% YoY
• As of February 4th, 2024 Spider-Man 2 sold through more than 10M
• Marvel's Spider-Man series has sold through more than 50M copies across console and PC as of Dec. 31

Estimate for next FY:

• It will be PS5's 5th year, meaning it enters in the later part of its life cycle (yearly sales of a console make a curve, peaking normally around its 4th year, so after that year they slowly decrease their yearly sales every year) so they expect that it's going to be the first year where hardware sales will decrease YoY, which will be compensated getting more profitability due to higher software sales (as always mostly from 3rd party) due to higher install base and user engagement.
• They expect PS Plus to stay flat or slightly decrease in subscribers due to the price increase they recently implemented, but to increase in revenue as subscribers keep continue migrating to a more expensive tiers
• Costs related to recent acquisitions will ease
• They expect 3rd party sales to decrease slightly YoY due to the decrease in sales
• Operating income is expected to increase slightly YoY. They are taking measures for further profitability in advance of the announcement of their estimations for the next FY this May

Mid term plan in strategic investment (acquisitions + investments + stock acquisitions):

• Got the greenlight for the Sony Financial Group spinoff, its execution and selling shares is expected for Octover 2025 (remember, they plan to spend most of this money for acquisitions mainly for entertainment and particularly gaming)
• In March ends the current 3 years mid term plan, a new one starts in April. They'll detail it this Spring in May when announcing the FY report
• They may slightly increase in the strategical investments area for the next mid term plan
• There are some opportunities they have to look at, so it's difficult to say specifics precisely now
• For next fiscal year they expect to invest a similar level of the current fiscal year, maybe slighly smaller
• They expect games being the driver of their ROI
• They'll continue growing in India, they'll try to replace the failed Zee acquisitions with other opportunities if needed

PS strategy

• Nowadays compared to previous generations it's harder and more expensive to reduce console costs by making smaller chips and make each console sold more profitable, allowing back even price cuts. Since they can't do that now and want to keep their business profitable, instead of price cuts they plan to compensate that with higher user engament and upsales of units, increasing the revenue per user
• They are experimening with PS Portal to increase time spent playing, and getting feedback
• Regarding 1st party software next FY they'll "continue producing high quality works and developing live service games and while major projects are under development, don't plan to release any major existing franchises title that fiscal year like GoWR or Spider-Man 2 (meaning, they'll release instead new IP or existing IPs smaller than GoW or Spider-Man)
• Totoki has been SIE chairperson during 4 months, when asked about his impressions, he said: "I'm trying to show leadership having meetings with the mangement team and visiting the studios. Everyone is working really hard to fullfill their responsability to try to optimize their businesses.
  
  And I understand that, but overall growth and sustainable profitability or increasing margins. How will that translate to these goals? I don't think people understand that deeply. I don't think people understand that deeply. I think that is the problem of the organization. So as far as I'm concerned, I try to understand what is happening in the company and the industry and also the perspective of the analysts, and try to explain it on a transparent matter so the people can recognize and notice these issues, so that we can have a harmonized approach going forward.
  
  This is a very general comment of since I became chairperson. There are concrete points which I won't go into detail today.
  
  Now, about visiting the studios and having meetings with the leaders of the studios. People who work in the studios have a very high motivation, they are very good people and are very creative people. They have very creative minds and also have knowledge about live streaming (I assume it's a mistranslation and meant live services). However, having said that, when it comes to the business itself I think there's room for improvement. It has to do on how to use the money or about schedules of development, or how to fulfill accountability towards development etc. Those are my frank impressions.
  
  So I'll continue engaging a lot with the people, so we can find the right way to proceed." (TLDR: Totoki said a nothingburger: he visits devs and they are very creative but games are so expensive and often they have delays)
  
  
• When asked about gaming operating income being low and ways to improve it, he mentioned "cost reduction in PS5 hardware nowadays is very difficult compared to previous versions, because price of components instead of going down as usual they are going up. So how can they keep the cost affordable and sustainable? A potential driver is the first party title generation, because in the past as you all know their main purpose was to make the console hardware more popular. Right? It is true, right? But there's a finish to it, if you have a strong first party content not only in our console but also in other platforms like computers and the first party can be grown with multiplatform, that can also improve the operating profit. I personally think there are oportunities out there for improvement of margins. So I want to go aggresive about improving our margins performance." (TLDR: can't reduce hardware costs or price cut it, so they are compensating that lack of profitability with the very profitable PC ports, and plan to continue pushing it)
• Normally a console has during its 4th year peak in hardware sales, in its 5th year peak of software sales and 6th year in profitability, but in PS4 they had the software peak during covid, so can't rely too much on that kind of estimates. Compared to PS4, the PS5 market is geting bigger but the profitability of the hardware is higher for PS4. So with BOM cost won't decrease with the console, how can they they hit the balance with the margin? There's another point that will impact profitability: next year the related costs of previous acquisitions will ease improving profitability. It's going to be a challenge but in the 3 years mid term plan Totoki wants to beat the profit record they had in FY21.

Graphs from the purple forum + Sony conference call and documents:

 

[lynux3]

First full year of supply and they missed targets is not impressive

But the writing was on the wall when they had that 3.3 million quarter last summer. When you treat the people who made you who are as second class citizens eventually they go elsewhere.

So 21M units is lackluster?

 

[FatKaz]

The fact that places like Europe are still paying higher prices for ps5 then on launch is crazy. obviously you get temporary price cuts here and there, but it really need to be permanent.

 

[Evilms]

 

[Evilnemesis8]

The fact that places like Europe are still paying higher prices for ps5 then on launch is crazy. obviously you get temporary price cuts here and there, but it really need to be permanent.

The operating margins being that low should tell you how unfeasible that is, they can't do it.

 

[Danja]

So 21M units is lackluster?

It is and there's no guarantee they will hit 21M

 

[FatKaz]

The operating margins being that low should tell you how unfeasible that is, they can't do it.

Yeah true. Keeping the price higher probably saved helped their margins a bit there.

 

[Danja]

The fact that places like Europe are still paying higher prices for ps5 then on launch is crazy. obviously you get temporary price cuts here and there, but it really need to be permanent.

The sales shows it too they are almost 5 million launched aligned behind PS4 in that region still. Their blue wall definitely cracked a little

 

[gokuss4]

Yep it's obvious now
Playstation will go third party soon
We laughed at xbox fans
But I guess sony will fellow the same fate

 

[lynux3]

It is and there's no guarantee they will hit 21M

It’s forecasted, could be higher or lower, but to say it’s lackluster… interesting. Just trying to understand what you think or gauge hardware sales in order to be a success? Obviously needs to be higher than 21M units. What other consoles do you know of that have done that in the last 50 years?

 

[Danja]

It’s forecasted, could be higher or lower, but to say it’s lackluster… interesting. Just trying to understand what you think or gauge hardware sales in order to be a success? Obviously needs to be higher than 21M units. What other states do you know of that have done that in the last 50 years?

For all the talk of unprecedented demand they kept talking about early last year in financial earning calls, yes it is lackluster.

And honestly I'm just being slightly petty for all the shit a few delusional fans on this site had to say all of last year.

But even so PS5 peak year being 19 - 21 million is beyond pathetic given all the momentum they went into this gen with.

 

[lynux3]

For all the talk of unprecedented demand they kept talking about early last year in financial earning calls, yes it is lackluster.

And honestly I'm just being slightly petty for all the shit a few delusional fans on this site had to say all of last year.

But even so PS5 peak year being 19 - 21 million is beyond pathetic given all the momentum they went into this gen with.

Again, what other consoles do you know of that have done that in the last 50 years?