The PlayStation 5 is no longer riding the easy part of the console cycle.
Sony said in its latest earnings presentation that it sold 1.5 million PS5 consoles in its fourth fiscal quarter, down 46 percent from the same period a year earlier. That slowdown comes after memory shortages helped push PS5 pricing higher twice in less than a year.
The broader PlayStation business is not collapsing. Sony’s gaming revenue was slightly up for the full fiscal year, and operating income improved thanks in part to PlayStation Network sales. But hardware is clearly under pressure, and Sony is forecasting a six percent revenue drop for the gaming division next year.
The company is also starting to talk more plainly about the next generation. Sony said investments in its next-generation platform will weigh on profits, which is about as close as it gets to acknowledging that PS6 development costs are now part of the business picture.
For players, the rough part is price. A standard PS5 has become harder to justify after recent increases, especially for a console that is approaching six years old. Grand Theft Auto VI may help software momentum later this year, but expensive hardware can still slow the funnel for new buyers.
Sony’s next year now depends on a strange mix of demand, memory supply and how much patience players have left for higher console prices. That is a very different story from the PS5’s sold-out early years.
