Sony said PlayStation 5 sales have likely peaked and expects a gradual decline in the coming years. This news caused the company's shares to decline significantly. This is the biggest decline for stocks in the past two years.
According to Bloomberg, Sony shares fell as much as 8.4% on Thursday and lost 6.5% at the close. This came after the announcement of the company's latest financial results.
Sony will miss its goal of selling 25 million PS5 consoles this fiscal year, which ends in March. Instead, it expects to sell 21 million units. In addition, the company also admitted that it does not plan to release any big titles in the near future. Analysts say the Japanese may face a problem due to competition from Microsoft and its Game Pass servicewhich provides access to over a hundred games for a low monthly fee.
Dr. Serkan Toto, a Tokyo-based industry consultant, said: “It was clear that Sony would never reach 25 million units this fiscal year. The third quarter was good, but it was only possible thanks to deep promotions and discounts during the holiday season..
“We have long feared that Microsoft, with its deep pockets and its Game Pass subscription service, could be very disruptive to Sony,” said Amir Anwarzadeh, a strategist at Ametric Advisors.
Sony is trying to improve its position by reducing prices for the PS5 Slim console, which replaced the initial model in November. The company also plans to port more of its games to PC, which is expected to increase its reach and profits. However, it's unclear whether this will be enough to keep interest in the PS5 at an all-time high.
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