Incoming PlayStation Chairman Says They Don’t Understand “Overall Growth And Sustainable Profitability”

gameranx.com:

Sony President, COO and CFO Hiroki Totoki was asked about his assessment of the company’s PlayStation division. He did not mince words.

We’ll go straight to the big quote in our headline. As reported by Video Games Chronicle, he said this when asked about their gaming side in an earnings call:

“It’s been about four months [since I became Chairman] and I’m trying to demonstrate leadership and have as many meetings as possible with the management team.

I’ve also visited studios, and everyone is working really hard to fulfil their responsibility to try to optimize the business, and I understand that.

But overall growth and sustainable profitability for increasing margins… how will that translate to these goals? I don’t think people understand that deeply. I think that is the problem of the organization.”

I think we can all agree that this seems to be a harsh assessment, especially given how successful Sony has been in this console generation. But we should take his statement in their proper context.

Totoki is set to become the chairman of the PlayStation division, while also fulfilling his roles as Sony’s President, COO, and CFO. That may sound like a lot of jobs to take on, but he isn’t planning to stay on permanently, and there’s a particular reason he wants to take over.

He is assuming the post after the retirement of current PlayStation chair Jim Ryan. Jim was head of the division at a time when the company had taken a dominant position in the video game console business, clearly overtaking Xbox, and perhaps not quite matching Nintendo Switch on hardware and first party sales, but still ahead in other metrics.

But, all this talk of PlayStation’s success has been somewhat misleading. As we learned in leaked documents from the Insomniac ransomware attack, the company is not making their first party games in a sustainable manner, spending too much for too little sales of their titles. In fact, even their most successful first party games, like Marvel’s Spider-Man 2