PS5 With Great Launch Despite Shortages; Sony's Financial Results
Sony is pleased with PS5's great launch. The console, despite problems with availability and a higher price than the PS4, recorded equally good sales, enabling the Japanese company to earn record money.
- PlayStation 5 is off to a great start. Sony shipped 4.5 million consoles to stores between November and the end of December 2020;
- This enabled the company to achieve its best financial result for the quarter in which the new hardware debuted.
The PlayStation 5 is off to an exceptionally good start. Sony revealed in its latest financial report that 4.5 million PS5 consoles were shipped to stores by December 31, 2020. This is on par with what the PS4 recorded during the same period, but is more impressive due to the console's higher price and its massive availability issues.
The result has enabled Sony to maintain its plans to ship 7.6 million consoles to stores by the end of March 2021. When we look at the financial results, the start of this generation enabled Sony to break the previous rule that the manufacturer loses money first, to make up for the investment in new hardware over time. The Japanese manufacturer recorded $767 million in operating profit in the quarter in which the PS5 debuted.
As for the PlayStation 4, despite the limitations in production and the debut of the PlayStation 5, the console continues to sell decently, although a significant year-over-year decline is evident. In the last quarter (October-December 2020 period), 1.4 million PS4s were sold, bringing the total to 6.2 million in 2020, and 115 million since launch.
Sony also boasted the number of active PlayStation Plus subscriptions, which stands at 47.4 million at the end of the year (up 8.6 million year-over-year). 87.5% of PS5 owners have an active PS Plus subscription. Also games can boast a good result. PS4 and PS5 titles sold 103.7 million copies in the last quarter of 2020, of which 18.4 million were games published by Sony.
With such results, the third fiscal quarter of 2020 (October-December) was the best in the history of the segment responsible for games. Sony will be able to boast a similar achievement for the whole year when taking into account the revenues and profits. The Japanese company also raised its projected financial results due to better than initially expected sales of games and network services (PlayStation Now and PlayStation Plus).
Despite the record-breaking results, it's also worth bearing in mind that Sony is losing money on every console unit produced, although we don't officially know exactly how much. This offers the prospect of even better results once production costs and global market conditions normalize.
