PS5 has only just stopped losing money for Sony – but that’s normal
Out of the red
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Sony’s disc-basedPS5console is no longer selling at a loss, according to the company’s chief financial officer Hiroki Totoki.
Bloombergreports that Totoki shared the news at Sony’s recent earnings briefing, which comes shortly after the Japanese tech giant confirmed the PS5 is now the fastest-selling PlayStation system of all time.
For the first time since its November 2020 release, the PS5 is covering its own manufacturing costs, though the less expensive and disc-less Digital Edition is still losing money for Sony.
That doesn’t mean the company isn’t making a profit, though. Bloomberg reports that the losses incurred by the PS5 Digital Edition continue to be offset by the enduring sales of hardware like the PS4, and it’s normal for games consoles to sell at a loss in the early months of their life cycle.
ThePS4, for instance – which has now sold over 116 million units worldwide – didn’t turn a profit until six months after release.
There are exceptions to the rule, of course. TheNintendo Switchbegan making money from the get-go, but it’s rare that consoles form the biggest part of a company’s sales.
Microsofthas famouslynever turned a profiton any of its Xbox hardware, for example, with most revenue coming instead from game sales or subscription services likeXbox Game Pass.
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Analysis: Can the PS5 outsell the PS4?
Eventually, maybe. But not for a long time.
Despite taking a little longer to cross over into the green (or orange, at least), meteoric sales of the PS5haveensured Sony’s latest console looks set to make a financial impression comparable to its predecessor – but theglobal chip shortagemeans the company is struggling to manufacture enough PS5 systems to meet global demand.
With millions still wonderingwhere to buy a PS5, there’s no denying the interest in Sony’s product, but there’s little sign that manufacturing speeds will begin to match those of the PS4 any time soon.
Still, Sony has managed tosell 10 millionPS5 consoles in the same time it took to sell 7.8 million PS4s, so if demand is sustained, there’s every chance that – in the next six or seven years – the PS5 could outmuscle its older sibling for total units sold.
Until then, though, we’ll keep waiting in the restock queues.
ViaGamespot
Axel is TechRadar’s UK-based Phones Editor, reporting on everything from the latest Apple developments to newest AI breakthroughs as part of the site’s Mobile Computing vertical. Having previously written for publications including Esquire and FourFourTwo, Axel is well-versed in the applications of technology beyond the desktop, and his coverage extends from general reporting and analysis to in-depth interviews and opinion.
Axel studied for a degree in English Literature at the University of Warwick before joining TechRadar in 2020, where he then earned an NCTJ qualification as part of the company’s inaugural digital training scheme.
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