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[Ronin_7]

Biggest gaming giant, SIE missed their target.

While results are still very good, it's a far cry of what Sony was hoping.

Imagine the situation at Xbox

Sony FY23 Q3 Financial Results! Record-breaking Q3 Revenue, 5.96% Operating Margin, and 8.2M PS5 shipped (54.8m PS5 shipped LTD)!

Notes: * US Dollar figures have been converted from Japanese Yen using the Average Exchange Rates provided by Sony in their Earning Releases. ** YoY/QoQ growth is calculated using the original Japanese Yen figures. *** To ensure consistency and avoid confusion, comparisons will be made...

www.resetera.com

More layoffs & closures to come.

 

[Barakov]

 

[Mister Wolf]

What worthwhile first party exclusives do they have coming in 2024?

 

[BaneIsPain]

read source

 

[Mibu no ookami]

I told people they wouldn't hit 25 million units for the calendar year and that Spider-Man while performing well, probably isn't to expectations.

They had to bundle Spider-Man 2 with the PS5 which they probably didn't want to do at cost and they're now discounting the PS5 in Europe.

That being said, would be hilarious to overreact to this news.

 

[Loomy]

This seems more reasonable, especially now. They're definitely not lowering prices. But they do need to release more exclusive games this year(I hope they're ready). That's something they can control, unlike the realities of most people's spending ability right now.

 

[Spitfire098]

Hey...it could always be worse

 

[Varteras]

 

[March Climber]

That being said, would be hilarious to overreact to this news.

They're going to anyway

Mibu no ookami What do you think Sony's way forward looks like?

 

[zokie]

they will need to bundle PS5 slim with1st party game download code to boost sales later this year

 

[nial]

What worthwhile first party exclusives do they have coming in 2024?

Stellar Blade and Rise of the Ronin, and Helldivers 2 as a console exclusive.
This conversation is getting tiring, these are all first-party games to SIE, get over it.

 

[Three]

This was clear as day to me:

If they hit their target I will be surprised. Props to them if they do since it seemed overinflated to me.

I suspect that they expected a bigger boost from PS5 Slim sales. Tom Hendersons Pro rumours have probably put a real damper on things too.

 

[Heisenberg007]

25 million was always going to be a steep goal, but they still did great.

And, by the way, THIS is why "Sony needs competition by Xbox" is not a valid argument. They will aways be competing with QoQ internal growth targets. They didn't meet expectations this quarter and will make improvements so they can next quarter. They don't need external competition for that.

 

[ADiTAR]

I don't even understand how they thought they could hit 25m, the Switch only hit over that once during a pandemic where everyone stayed home to play Animal Crossing. Sony didn't have an animal crossing phenomenon.

They still did good, just expectations didn't meat reality.

 

[lh032]

just a reminder that theres hardly any 1st party release from Sony, the sales is considered good enough despite they failed to hit the target.

 

[IDappa]

25 million was always going to be a steep goal, but they still did great.

And, by the way, THIS is why "Sony needs competition by Xbox" is not a valid argument. They will aways be competing with QoQ internal growth targets. They didn't meet expectations this quarter and will make improvements so they can next quarter. They don't need external competition for that.

That’s bullshit man, you can’t honestly argue that competition isn’t a good thing?. Or am I reading this wrong….

Edit.. didn’t they just increase crunchy roll by fifty bucks which pretty much has no competition?.

 

[Varteras]

What worthwhile first party exclusives do they have coming in 2024?

 

[zapper]

time for a pro and decrease the price of the console. however it wasn't a brilliant idea not to have offers in December, in Europe PS5 was back to the original (increased) price with the slim model

 

[Raonak]

Their expectations were quite lofty, the best PS2 year was 22 million.

 

[Mibu no ookami]

They're going to anyway

Mibu no ookami What do you think Sony's way forward looks like?

I think Sony is in a historically strong position in the industry, but in the near term, I think their sales are going to be limited. They might even sell fewer units next fiscal year than they did this fiscal year.

PS5 Pro
PS5 Handheld
PC Storefront
Live Service games
Playstation Productions (TV and Movie)
Expanded peripherals business

One of Sony's biggest problems is they run on pretty low margins, they have to change that. They just have to. A few failures could really derail them short term and they also have to shore up their first-party pipeline.

The good news for Sony is time is on their hands. The bad news for Sony is that they're a bit in decline in the short term, but the next 2-3 years... yeah, should be pretty good.

 

[Varteras]

Their expectations were quite lofty, the best PS2 year was 22 million.

And that was achieved during a generation where there was virtually no competition.

 

[Borowski_1]

N

What worthwhile first party exclusives do they have coming in 2024?

None

 

[Mibu no ookami]

time for a pro and decrease the price of the console. however it wasn't a brilliant idea not to have offers in December, in Europe PS5 was back to the original (increased) price with the slim model

Decreasing the price decreases their margins and Xbox isn't selling so it doesn't make a lot of sense to decrease the price too much. They might have to take another look at this once the Ps5 Pro launches.

They're operating income was already impacted by discounts in North America (discount being a PS5 bundled with Spider-Man). They didn't need to do this in Europe during the holidays because they knew they had Microsoft beat.

 

[Mibu no ookami]

James Sawyer Ford and Mr.Phoenix thoughts?

I said it was clear that Spider-Man 2 wouldn't perform well enough to push the PS5 to 25 million. It wasn't even close.

 

[Chastten]

So they had a record breaking year, yet missed the sales target? Did they hire some people from SquareEnix or something?

 

[nial]

25M was always unrealistic tho, I still don't know what were they really expecting with that target. 18-20M was MUCH more reasonable, and what it'll probably end up doing.

 

[peish]

That’ll show the brilliance of phil multi platform strategy

Consoles market in its current form hasn’t improved or increased TAM, it’s always around 100m units sold per lifetime

I think each new iphones series sell well above 100m

 

[killatopak]

That’ll show the brilliance of phil multi platform strategy

Consoles market in its current form hasn’t improved or increased TAM, it’s always around 100m units sold per lifetime

I think each new iphones series sell well above 100m

We only need to tap into 1% of the chinese market.

 

[James Sawyer Ford]

Why is profit so low on that high of revenue? Especially since they increased the ps5 price and costs of ps5 should be coming down.

Did they have a massive write off in the quarter?

 

[Mibu no ookami]

O onQ123 thoughts?

Why is profit so low on that high of revenue? Especially since they increased the ps5 price and costs of ps5 should be coming down.

Did they have a massive write off in the quarter?

They have a lot of studios and game development costs are high. They're selling the PS5 at a loss due to the bundle with Spider-Man 2.

Spider-Man 2's operating income is going to be significantly lower than other 1st party titles and the game didn't sell nearly as well as it needed to, as I mentioned 3 months ago, especially with the bundle.

 

[Go_Ly_Dow]

Why is profit so low on that high of revenue? Especially since they increased the ps5 price and costs of ps5 should be coming down.

Did they have a massive write off in the quarter?

Inflation.

 

[LavitzSlambert]

Almost as if big budget games are not always worth the cost.

 

[Heisenberg007]

That’s bullshit man, you can’t honestly argue that competition isn’t a good thing?. Or am I reading this wrong….

Edit.. didn’t they just increase crunchy roll by fifty bucks which pretty much has no competition?.

Competition is a good thing. Xbox has not been that competition though. Besides, stockholders demand constant growth. That's enough to light fire under their ass.

And considering their low-profit margins, despite record revenue, I'd not be surprised if SIE increases the prices of certain things. And I think that'd be justified. Xbox also increased their Xbox Live Gold price by 100% even though they were struggling in the last place.

Anyway, this conversation would just derail the thread, so I'd avoid it.

 

[lh032]

That’ll show the brilliance of phil multi platform strategy

Consoles market in its current form hasn’t improved or increased TAM, it’s always around 100m units sold per lifetime

I think each new iphones series sell well above 100m

i think we should wait and see whether phil multi platform approach is working in the near future.

 

[DenchDeckard]

4 years into the generation and not having a steady clip of first party games will do that for you.

I still believe they are losing money on hardware, even though people keep trying to tell us otherwise.

All based on one comment like 3 years ago, so I do understand but things change.

The fact you can still buy a phat ps5 6 months after it was discounted shows how bad holiday was.

They've probably overstuffed the channel with slim stock too to try hit the 25 mill but we will only find out if that's the case after first half this year. If we hear rumblings on severe manufacturing cuts.

High end gaming isn't sustainable.

Nintendo is the only one getting through this unscathed.

 

[Go_Ly_Dow]

Almost as if big budget games are not always worth the cost.

Don't tell GAF that.

 

[Heisenberg007]

Why is profit so low on that high of revenue? Especially since they increased the ps5 price and costs of ps5 should be coming down.

Did they have a massive write off in the quarter?

Heavy marketing costs, I think. Also the ever-increasing game development costs.

 

[Schachtier]

What was the last original game that was released since the launch auf PS5? Anyone? Its a Generation of remasters and revisits.

 

[Mibu no ookami]

So they had a record breaking year, yet missed the sales target? Did they hire some people from SquareEnix or something?

They put sales expectations to 25 million. They had expected TLOU Online to come out this year and they expected stronger holiday sales. They misjudged the strength of sales based on the previous year's demand.

To maintain or increase demand you have to have a better software portfolio or a cheaper price. The PS5 largely was more expensive across the world this year and had a worse software lineup.

25M was always unrealistic tho, I still don't know what were they really expecting with that target. 18-20M was MUCH more reasonable, and what it'll probably end up doing.

They were expecting the unreasonable demand to continue for the PS5, but games like FF16 really underperformed as did Spider-Man 2. Then you had games canceled that they probably thought would come out this in the calendar year like TLOU Online.

The lack of meeting targets is likely why Connie Booth is out and why Herman Hulst isn't being named the next CEO. Herman will be out too if 1st party doesn't improve its pipeline.

 

[Sakura]

It was always obvious they weren't going to meet their targets, yet people were disagreeing with me for some reason at the time.
It's still tracking behind the PS4.

 

[Kikorin]

Well, their first party games output has been terrible and 2024 by now seems even worst (ok Stellar Blade, but we can expect some Bayonetta numbers pretty much if it delivers and I don't even talk about the SH2 Remake that looks awful). They need to start releasing games, at this point people that would have bought a PS5 no matter what are finishing, so is the moment to propose something worthwhile.

 

[DenchDeckard]

I guess the covid boom is truly over now.

Like others have said, you need a strong line up of games and we've been given remakes and remasters.

4 years in and naughty dog hasn't announced a new game for this gen. Shit, either has ssm.

 

[Robb]

25M was an insane target, although I will admit I didn’t think it was unreasonable.

Still very good numbers though.

 

[Midn1ght]

Should have announce a permanent price drop with the release of the Slim.
Phat PS5 were discounted to 450-470 EUR during the holiday season where I'm at and they were flying off the shelves.

Stop being greedy, the console is gonna be 4 years old and all you did is increase its price.

Announce some big first party games too.

 

[Ar¢tos]

Stellar Blade and Rise of the Ronin, and Helldivers 2 as a console exclusive.
This conversation is getting tiring, these are all first-party games to SIE, get over it.

Stellar Blade and Rise of Ronin are third party exclusives, neither the studios or the IPs belong to Sony, it's not a Bloodborne situation.
In theory, after the time set in the contract ends, they can published on other platforms by other publisher, with a suffixed name (director's cut, uncut, definitive edition, etc) to prevent conflicts.

 

[Mibu no ookami]

That’ll show the brilliance of phil multi platform strategy

Consoles market in its current form hasn’t improved or increased TAM, it’s always around 100m units sold per lifetime

I think each new iphones series sell well above 100m

This is extremely inaccurate and Phil's multiplatform strategy is going to foreclose on Xbox console sales. The reality is he's betting that Microsoft can sell more software on PS5 and Switch rather than rely solely on Xbox and GamePass.

The console market is well above 100m units.

 

[newtypepilot]

uses REE as a source

please take away OP's posting privileges.

 

[3liteDragon]

Their first party PS5 exclusive lineup’s been pathetic so far, the latter half of the gen better be fucking stacked.

 

[Bojji]

Well, their first party games output has been terrible and 2024 by now seems even worst (ok Stellar Blade, but we can expect some Bayonetta numbers pretty much if it delivers and I don't even talk about the SH2 Remake that looks awful). They need to start releasing games, at this point people that would have bought a PS5 no matter what are finishing, so is the moment to propose something worthwhile.

Yeah, this "ps3 has no games" meme should be updated for PS5. Starting from 2009 (3rd year) ps3 had steady number of great games. We are entering 4th year of PS5 gen and there are barely any games from Sony.

 

[Lagspike_exe]

Yeah, this "ps3 has no games" meme should be updated for PS5. Starting from 2009 (3rd year) ps3 had steady number of great games. We are entering 4th year of PS5 gen and there are barely any games from Sony.

They released everything cross-gen. It takes a while for a new cycle to kick in.
But I agree, this generation barely feels like a new generation in terms of games. I could count a handful a games that really feel "next gen".