Sony recently published its sales numbers for the financial quarter ending December 31, 2020. As expected, the company is leading to its best year ever with massive revenue across several gaming ventures. With over 4.5 million units shipped up till now, the PS5 might seem like the driving force of these profits, but surprisingly, the console is currently being sold at a loss.
However, the PS5 had a very positive impact on the software and network sales for Sony. This includes the sales of exclusive titles and subscription services like PlayStation Plus.
How the PS5 improved software and network sales for Sony
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Daniel Ahmad, Senior Analyst at Niko Partners, discovered some interesting aspects of Sony’s latest profits. The company’s Game and Network Services Segment made over $8 billion in the latest quarter, which is a 40% increase from last year. Similarly, the Operating Income for the segment showcased a 50% growth rate.
Daniel Ahmad believes that this increase is an outcome of PS5’s launch.
Sony's Game & Network Services Segment reported Q3 (Oct-Dec) revenues of 883.2 billion yen ($8.43 billion), up 40% YoY.
Operating Income for the quarter was 80.2 billion yen ($767 million), up 50% YoY.
Increase due to PS5 launch + strong software and network sales. pic.twitter.com/i2BVCvLAxM
— Daniel Ahmad (@ZhugeEX) February 3, 2021
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In another tweet, Daniel talked about the 114 million active PlayStation network users across all devices. Out of these, almost 50 million users have subscribed to PlayStation Plus. Naturally, this significant growth in PlayStation’s user base has also led to the sale of over 18 million first party games until December 31, 2020.
The number of active PlayStation network users across all PlayStation devices has reached 114 million.
The total number of paid PlayStation Plus subscribers is now 47.4 million which is up from 38.8 million in the same quarter last year.
— Daniel Ahmad (@ZhugeEX) February 3, 2021
Is Sony facing production issues?
Ever since its release in November 2020, Sony has been struggling to meet the staggering demand for the PS5. Time and again, the console giant has rejected that it is facing production issues, but a comparison with the initial PS4 sales highlight a different scenario.
Back in 2013, Sony had shipped 4.5 million PS4 units in the same 2013 quarter. Considering that there has been a substantial increase in the number of gamers in the world, and especially the members of the PlayStation community, Sony’s failure to improve its production capacities is unfortunate.
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Regardless, it seems like Sony has finally shifted its focus on the PS5 now. The producer only shipped 1.4 million PS4 units in the last quarter, which is a noticeable drop from 6 million units in the previous year.
The PlayStation 4 only shipped 1.4 million units in the holiday quarter, down from 6 million last year. Reflecting lower demand but also a shift in manufacturing prioritisation to PS5.
The total sell in of PlayStation 4 is currently at 115.1 million units.
— Daniel Ahmad (@ZhugeEX) February 3, 2021
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As for now, the retail cost of the PS5 remains lower than its build cost. While the digital games sales and subscription services have helped Sony in maintaining colossal profits, such a trend might harm the company in the longer run.