Sony’s FY24 Q3 Results
Sony’s Q3 financials dropped and here are the hardware & software results followed by some commentary.
Highlights
8.2 million PS5 units were shipped to retailers in Q3 (up 15% YoY)
89.7 million pieces of software were shipped (up 4% YoY)
The PS5 has a culmulative LTD of 54.8m
Best Q3 ever for revenue
Current PS5 sales for the FY stand at 16.4m
That last bullet point is of most interest to me. A few months back, I wrote:
So far this fiscal year, Sony has shipped 8.2 million [PS5] units (3.3m in Q1 and 4.9m in Q2). They’d need a massive Q3, maybe reaching 12m at the least, to make [their 25m unit target]. This is the story to watch for me here. Sony feels as though it can still make it!
Big revenue but limited profit margins
Given that current FY PS5 sales reached 16.4m as of 12/31/23, it's highly unlikely that Sony will achieve the projected 25m units shipped. Consequently, they've revised their forecast to 21m units shipped for the fiscal year. However, this figure still appears optimistic to me. The decision to ship 4.6 million units in Q1 seems excessive, particularly considering the limited software available to drive hardware sales during this quarter.
In fact, Sony mentioned that it will have no first-party software available to push hardware until 2025.
“Regarding first-party software, we aim to continue to focus on producing high-quality works and developing live service games, but, while major projects are currently under development, we do not plan to release any new major existing franchise titles next fiscal year like God of War Ragnarök and Marvelʼs Spider-Man,” says Sony president, COO, and CFO Hiroki Totoki
With the revised FY forecast for PS5 and Sony's decision not to release any first-party software in 2025, it's possible that this fiscal year could mark the peak for the PS5. Given these circumstances, I have doubts about the system's ability to meet the revised forecast of 21 million units. In fact, I'm uncertain if it will even reach 20 million. We shall see in a few months time.
Once again, Sony’s financials for next quarter are my most anticipated! Will Sony be able to hit it’s new 21 million target or will it fall well short? Time will tell.