Tuesday January 30, 2007 1:13 pm
Sony Profits Drop 5% On PS3 Launch Costs
Sony’s 3rd quarter financial results reflect a 5% drop in net profit year-over-year largely due to costs incurred launching the Playstation 3. A BusinessWeek report on the financial results indicates that despite this loss, Sony has raised its guidance for the year due to its successes in the flat-panel TV and digital camera arenas. While the games division used to be a huge profit center for Sony, lately gaming has been dragging the company down. Sony missed its shipment targets for the Playstation 3, but still believes it is on track to ship 6 million consoles worldwide by the end of March. Still, Playstation 2 and PSP unit sales were down. Third quarter sales of the Playstation 2 were down 1.25 million units to 4.11 million sold, a decrease of roughly 30%. Sales of the PSP were down even more; the company moved only 1.76 million handhelds compared to over 6 million sold during the third quarter of 2005, a decrease of nearly 75%. Sony seems to be losing battles on two fronts right now, with lost opportunities on the Playstation 3 side leading to conversions to either Nintendo’s Wii or the Microsoft Xbox 360. The PSP is getting beat up horrendously by the Nintendo DS; while Sony’s handheld had held its ground for quite some time, its popularity now appears to be fading. Sony hopes to get things turned around with the Playstation 3 soon; console availability doesn’t seem to be as much of a problem as a lack of exclusive titles.
Read More | Sony Financial Release [PDF]
Read More | BusinessWeek
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