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Sony Scales Back Earnings Expectations Following Slump In Game Sales

Sony has been hit hard this quarter in terms of its overall profitability, suffering from a lack of high profile game releases and various forms of pandemic easing resulting in people spending less time at home, according to Chief Financial Officer Hiroki Totoki. The company has apparently scaled back its earnings expectations, mostly on account of the poor market performance on the part of PlayStation.

The news comes from a recent report given to investors, delivered earlier this week. The company announced a cut to the annual forecast of its Game & Network Services department by a whopping 16 percent, announcing a 37 percent drop in operating profit. Sales of games appear to have reached only 47 million units, a slump of nearly 30 percent. "The growth of the overall game market has decelerated as opportunities to go out have increased following a decline in Covid infections," Totoki noted.

Sony said that solving its ongoing supply chain issues could turn things around for the company. "Last quarter was just a bump in the road for Sony," Founder of Kantan Games Serkan Toto said. "It looks like Sony is actually now getting more and more PS5s into stores, especially in the US and Europe.”

The company still plans on selling 18 million units of the PS5 during this fiscal year despite its persistent supply chain problems. "With recovery from the impact of the lockdown in Shanghai and improvement in component supply, we are working to bring forward supply for the year end holiday season," Totoki remarked.

Sony apparently sold around 2.4 million units of the PS5 in the first quarter of this fiscal year, a slight increase over the previous fiscal year. The company shipped more than 11 million units of the PS5 during its previous fiscal year, missing its target of 14.8 million consoles by just over three million units. Sony attributed this shortcoming to supply chain issues.

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