Sony Casts Doubt on PlayStation Momentum With Cagey Outlook
Sony Group Corp. offered a conservative profit outlook for the current fiscal year, warning about the impact of the global consumer spending slump on its electronics and entertainment businesses.
The Tokyo-based firm said it expects operating income of ¥1.17 trillion ($8.7 billion) in the year ending March 2024, below average analyst estimates of ¥1.27 trillion. This was largely down to its PlayStation division, where Sony's guidance fell short of consensus and the company said it expects fewer sales of PlayStation Studios games this fiscal year.
Sales of Sony's flagship PlayStation 5 console reached 6.3 million in the quarter to March, more than tripling the supply-constrained numbers from the same period last year and showing Sony is finally able to distribute the hardware at scale. The company aims to sell 25 million units in the current year, president and Chief Operating Officer Hiroki Totoki said on a call Friday. But he cautioned that consumer electronics demand is likely to remain weak amid the wider economic slowdown.
“We expect a clear slowdown in the European economy and feel strong uncertainty on the Chinese economy,” Totoki said. “We're not optimistic about the outlook and remain vigilant especially on the US market, which has the largest impact to our business.”
The delayed adoption of the PS5, which launched in late 2020 but has been limited by production challenges, is showing signs of hampering Sony's ability to monetize the hardware through higher-margin software and subscriptions. Game sales in the latest quarter were down to 68 million units from 70.5 million in the same period a year earlier. The company reported operating profit of ¥128.5 billion.
“Sales of the hardware are increasing on par with Sony's
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