Sony's numbers add up
The electronics giant takes a hit with costs associated with the PS3 but bounces back with strong sales of other consumer goods.
By Emma Boyes, GameSpot UK
Posted Jan 30, 2007 4:50 am PT
Things may not be as bad as previously thought for Sony Computer Entertainment. Yesterday, a survey of five analysts by financial news service Bloomberg predicted that the company could be reporting a 50 percent drop in profits today. However, according to Sony's consolidated financial results for the third quarter of 2006, profits were only down 5.3 percent, and stood at 159.9 billion yen (approx $1.3 billion), compared to 168.9 billion yen ($1.4 billion) in the same period last year.
The Tokyo-based corporation did report a loss of 54.2 billion yen ($455 million) in its game division for Q3 2006, compared to a profit of 67.8 billion yen ($556 million) recorded in the previous year's third quarter. This was mainly due to selling the PlayStation 3 at "strategic price points"--console hardware units are often sold at an initial loss for the manufacturing company, with the money recouped from strong games sales. Other factors included additional costs incurred during the preparation for the launch of the next-gen console, and a decline in PlayStation 2 and PlayStation Portable sales. PSP sales were "lower than expected."
In Q3, the PS2 sold 4.1 million units worldwide, of which 1.7 million were sold in North America, 1.7 million in Europe, and 770,000 in Japan. The figures showed that the PS3 had sold 1.84 million units in total, with 800,000 of those going to Japan, and one million to the US. The PSP sold 1.76 million units worldwide in Q3, less than half the amount sold in Q2, with 860,000 sold in Japan, 890,000 in Europe, and 10,000 in North America.
For software, the PS2 sold 78 million units worldwide, the PSP 21.2 million, and the PS3 5.2 million. The results suggest that the majority of PS3 buyers in Japan only own a single game, as only one million software units have been sold to date in that territory.
However, things certainly aren't all doom and gloom for Sony--sales of Bravia televisions and Cyber-shot digital cameras were mentioned as being especially strong, contributing to an increase of almost 17 percent in sales and operating revenue for its Electronics division.
In October, Sony slashed its predicted forecast to 80 billion yen ($656 million) for its group net profit, down 38 percent. However, the company has now returned to its original, more optimistic, predictions, and raised the forecast back to 110 billion yen ($902 million)
