Sony is committed to accelerating PS5 production at “levels that [it has] never reached before” in order to meet the growing demand. In a briefing with investorsJim Ryan, President and CEO of Sony Interactive Entertainment, describes the successes and challenges the company has faced since launching its latest console.
In a recent update, Sony said it sold just 2 million PS5 consoles last quarter, bringing the total to 19.3 million. Not only is this a significant drop from the previous quarter, but it means the company sold 3.1 million fewer PS5 units than PS4 consoles at the same point in their lives.
Sony is encountering bottlenecks in sales not because of a drop in demand, but because of supply shortages caused by the coronavirus pandemic. Demand, in fact, remains high, with Sony claiming that 80,000 PS5 units can be sold in 82 minutes while the same number of PS4s would sell out in nine days. After a year, 55% of consumers surveyed were still interested in the PS5, while only 28% wanted a PS4 for its first birthday.
Sony thinks it can ramp up supply fast enough for the PS5 to overtake the PS4 in sales in its fourth year of release, or 2024. In the meantime, the company will look to multiple vendors “for more great agility in volatile market conditions” to alleviate supply shortages caused by the pandemic and avoid potential “logistics and parts inventory” issues resulting from Russia’s invasion of Ukraine.
Beyond the initial ramp-up, Sony “plans further large increases in console production, taking us to production levels we’ve never seen before,” Ryan said. during an investor briefing.
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Although Sony isn’t selling as many current-gen consoles, the company is enjoying an increase in game monetization. The PS5 saw a 15% increase in in-game spending compared to the PS4. Game add-ons account for a growing share of that revenue, jumping 247% across all console generations, while the sale of full games fell 21%. Rising subscription revenue also drove an overall increase.
While the PS5 struggles to find its footing, the PS4 continues to defy its age, breaking late lifecycle records. Sony notes that the PS4’s second year there were 36.1 million PS3 users, while the PS5’s second year there are 84 million PS4 users. This success must of course be seen with an asterisk given the very limited availability of the PS5 over these 24 months.
Sony wants to bring more Playstation games to PC and mobile
Regarding its strategy on game releases, Sony has stated that it wants around half of its game releases to be also be on PC and mobile by 2025. This would mark a significant increase from this year, while around a quarter of the company’s releases were on those two platforms. The company is already seeing benefits from expanding beyond its own platform: sales of games like Horizon Zero Dawn, Days goneand God of the warto have leads to a forecast of $300 million in PC sales versus $80 million last year.
“By expanding into PC and mobile, and it has to be said… live services as well, we have the opportunity to move from having a presence in a very narrow segment of the overall gaming software market to having a presence pretty much everywhere,” Ryan said, according to Chronicle of video games.
Other efforts to bring more gamers to PlayStation include the upcoming PS Plus redesign, PSVR 2 Headsetand expansion into other media.
