Sony Corp. makes billion-dollar loss

By Robert Purchese Published 14 May, 2009

But things are looking up for PS3 and PSP.

Sony expects PS3 and PSP to perform better this year and sell 13m and 15m units respectively by April 2010.

The company was speaking in its annual financial report for the year ending 31st March 2009. During those 12 months, the PS3 sold 10.1m units and PSP 14.1m units.

Sony Corporation overall, however, lost over 1bn dollars. And the biggest sales decrease came from the Computer Entertainment sector, which subsequently blamed diminishing sales of PS2 and currency fluctuation.

It's not all doom and gloom, though, as operating profit for the Computer Entertainment division was halved, thanks to trimmed manufacturing costs and a 45 per cent rise in PS3 game sales.

Sony expects that software momentum to carry over into this financial year, forecasting a slight increase across all PlayStation platforms. The company also poured plenty of faith into digital distribution, claiming PlayStation Network sales will triple over the 12 months.

It's just a shame Sony no longer has the insight of David Reeves, who knew months ago that "the most important thing for [Sony] as a company in the very short term is for us to start making money".

Picture of Robert.

About Robert Purchese

Bertie is Eurogamer's Senior Staff Writer. When he's not hunting down news stories he's often found playing with his kids or gabbling about fantasy games and strange online worlds.

Read more articles from Robert by visiting the Robert Purchese archive page.

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Comments (34) Latest comment 3 years ago

Comments threads automatically close after 30 days, but please feel free to continue chatting on the forum!

  • Sunyavadin #1 3 years ago

    Could be worse. They could be EA.

  • Widge #2 3 years ago

    I just read this on Kotaku, but they're saying an 80% increase.

  • liverpoolfc #3 3 years ago

    Ending the production of the ps2 will make more people consider the ps3

  • Eraysor #4 3 years ago

    Well if MGS4 happens to come to 360 I don't see myself ever bothering with a PS3, at least until they're less than £100 new. As for the PSP, they might be able to resurrect it with the new version, but it's unlikely.

  • chrisjm #5 3 years ago

    if someone is thinking of buying a ps2, they are a pov so wont buy a near £300 ps3.

  • kinky_mong #6 3 years ago

    if someone is thinking of buying a ps2, they are a pov so wont buy a near £300 ps3.

    Ha ha! I love the term "pov" or "pov-o"!

  • DrDamn #7 3 years ago

    @Widge
    There is something wrong with the wording in that paragraph ... "operating profit for the Computer Entertainment division was halved, thanks to trimmed manufacturing costs and a 45 per cent rise in PS3 game sales" - eh?

  • Doctor_What #8 3 years ago

    A price drop would probably increase those numbers a lot more. To me that article said that they wouldn't be dropping the price.

  • penhalion #9 3 years ago

    I think Sony have finally realised that floggin the dead PS2 horse as a source of reliable income is now a non starter (I'm trying to use as many racing puns as I can but, can't seem to remember any...).

    If they wish to be first past the post in the long haul that is the console race, then they need to start cutting prices and getting consumers motivated again. I'm looking forward to stuff like Uncharted 2 and infamous, so I think they are finally on the right track. Of course Microsoft aren't just going to be standing still and lett them bolt out of the styles unchallenged.

    Edit: Awe just thought of a scentence to use stable door after the horse has bolted, then my boss asked me something and now it's gone!
    Edited by 1 at 14/05/09 @ 11:43

  • Widge #10 3 years ago

    I will take up the offer of moar coffee.

  • Bigglesworth #11 3 years ago

    @DrDamn
    It must mean "operating losses".

    Also:
    "It's just a shame Sony no longer has the insight of David Reeves,

    Yeah... he was surely the only one in the company with the keen wit to recognise the need to make money... =)

  • AphoticCosmos #12 3 years ago

    Pro-tip: Invest in Europe you douchebags.

  • CallousB #13 3 years ago

    "It's not all doom and gloom, though, as operating profit for the Computer Entertainment division was halved, thanks to trimmed manufacturing costs and a 45 per cent rise in PS3 game sales."

    Wuh...operating profit being halved wouldn't be a good thing..

    ...I'm pretty sure you meant to write that operating losses were halved.

  • aine #14 3 years ago

    floggin the dead PS2 horse as a source of reliable income is now a non starter

    that's not exactly their fault; I recall the PS1 getting decent exclusives and interesting cheapo curiosities long after the PS2 was introduced, but with the PS2 third-parties seem to have abandoned it somewhat more quickly for whatever reason - it has still been getting new releases but they've mostly been dodgy movie licenses or quick ports, with one or two exceptions mostly in the form of japanese RPGs. even budget titles seem to have dried up for the most part.

  • DrDamn #15 3 years ago

    @Mr.Me
    Doesn't your post back up what Widge said? The only percentage in the EG article is the one on games and there they say a 45% rise. Widge said it was 80% and you say it was 80%. Why does Widge need to go back to school?

  • Widge #16 3 years ago

    I have no idea anymore, no breakfast today. Fading. Fast.

  • Negotiator #17 3 years ago

    Bye Bye Sony bye bye etc...

  • penhalion #18 3 years ago

    @aine

    I agree that it's not their fault (at least not entirely) as I recently purchased Persona 4 for my still backward compatible PS3. The reality is that I wouldn't have bought the game if I'd had to dust off my actual PS2 to play it. I certainly wouldn't have bought a new PS2 jsut for that game either.

    With the PS1, Sony actively supported the platform for quite a while after the PS2 came out. With the PS2 however, all Sony seem to be doing is selling the machine still, while all of their marketting and promotional muscle is solely focused on PS3 and PSP. Heck I wouldn't even know they were still making PS2 if not for those monthly hardware sales charts.

  • dingo75 #19 3 years ago

    Thing is the PS2 is often used soley as "party machine" with Sing Star and Guitar Hero.
    No need to buy a PS3 for that since people usually are too drunk anyways to care about graphics.

    My PS2 serves this purpose well and "Guitar Hero - Metallica" comes out end of May for it! :)
    Edited by 1 at 14/05/09 @ 13:16

  • bad09 #20 3 years ago

    "Ending the production of the ps2 will make more people consider the ps3 "

    Eh? I got my PS3 last May. Last month I got a new (2nd hand new) PS2 which has seen more gaming action in a month than my PS3 has had since I finished my import SH:HC months ago! Put PS2 BACK in PS3 and THAT will make more consider PS3.

    I like the "claiming PlayStation Network sales will triple over the 12 months" part in that article. Have Sony SEEN the prices they ask on there? No Retail will rule the roost. If they go DD only I suspect piracy will go through the roof at current pricing.....

  • Teamallstar #21 3 years ago

    I don't think it is a question now of whether or not Sony will lose the console war, but whether or not the company can continue to sustain such huge losses from its once dominent console division. it is very sad for gaming generally, but let's just hope that microsoft and nintendo will treat the gauntlet that they now hold with the respect that it deserves.

    I hate how badly they screwed this "next" generation of consoles up.

    I suppose that the better console won (the hard core) console war!

  • geeza2020 #22 3 years ago

    I would have loved to have been a fly on the wall in that board meeting! Somebody walking in and saying "uuuuh i dont suppose any of you have seen a BILLION DOLLARS lying around have you?????....aawww shit....."

  • penhalion #23 3 years ago

    @Bad09

    I agree with you about the PS2 back into PS3 thing. It would have made 100 times more sense if Sony had launced a fully backward compatible PS3 (complete with hardware) and immediately said a year from now stand alone PS2 will be no more. The 2 consoles in one thing would have given added value and some games like the persona series may even have finally made the jump to next gen. Existing PS2 stuff could have simply been re-branded and sole cheap to new PS3 owners as well as the existing huge PS2 ownership.

    Instead they continued both consoles and now, with the rapidly dying PS2 market, they have effectively lost a huge revenue stream with nothing tangible to replace it!

  • teabagger #24 3 years ago

    PS2 isn't a dead horse to be flogged. Its main relevance is in emerging markets like India, Iran etc. etc. rather than in the western markets.

  • Widge #25 3 years ago

    Give me back my stimulants!

  • des #26 3 years ago

    4 billion dollars loss in 3 years then...uh oh

  • El-Dev #27 3 years ago

    These figures come from a financial report I'm guessin, that means they are bullshit.

  • Diomedes #28 3 years ago

    Well ,the crisis is the crisis ,but both MS and Sony have posted losses in their gaming divisions.

    As for Sony treating gaming badly ...they have put out a marvellous console out with lots of good games ,features ,put out a great free online service etc etc ....of course if they made each PSN member pay 60 euros yearly they would be in black but I consider good for gaming the free online approach.

    Lets put aside the childish Sony hating and look at things straight ....this is bad for Sony ,not so for gaming .As long as Sony can keep the losses (and the last quarters it was in black its just the global year that is in red ) this isnt bad for gaming in any sense.It would only be bad for gaming if Sony dissappeared from the console scene.

  • bad09 #29 3 years ago

    @ penhalion

    Yeah that's why I'll never believe the "we did it to save money" line. I seriously think they cut themselves off from a lot of people with that move. Hell if it wasn't for MGS4 I probably still wouldn't own one because of that very reason.

  • Col_Ryan #30 3 years ago

    @ lord "Sales don't go up without a stimulus"

    I agree, but I've heard that a recession can stimulate. 'Instead of going out, people invest in home entertainment,' I think that was it. Game sales go up due to this and reduction in prices.

  • knightmt #31 3 years ago

    Blu Ray Discs will probably exceed the 100million mark in North America this year, that should offset some loss.

  • Ryze #32 3 years ago

    PS3lol iz t3h doom3d!!!!111!!one!1

    edit:

    @aine

    "...for whatever reason..."

    The Wii. The DS. The 360. XBLA.

    Collectively and metaphorically, it's the Dreamcast's influential ghost coming back to haunt, spook and sting Sony. Hard.
    Edited by 1 at 15/05/09 @ 00:59

  • Theorendil #33 3 years ago

    The onlt thing that will boost PS3 sales is a price drop... It's just too danm expensive for a lot of people...

  • EvilBob_leeds #34 3 years ago

    I think it largely is Sonys fault ;-)

    But they have suffered a strong Yen whereas MS have been able to profit from a piss weak dollar - to keep the PS3 at the price point its currently at in the US and Europe will have meant cutting their profit margins considerably. Which puts them in a tricky position - do they risk selling PS3s at more of a loss in order to hopefully make enough revenue to make up for it off Blu Rays and games?
    Edited by 1 at 15/05/09 @ 13:48