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PS3 Hardware Turns Profitable

Sony has been making money on system since the end of March. But PSP and PS2 hold back earnings.

 

Buy a PlayStation 3 system even without any games, and you'll be having a positive effect on Sony's bottom line. The PS3 hardware has at long last turned profitable.

According to a report at Reuters, PS3 hardware starting turning a profit for Sony at the end of March.

The Reuters report did not provide an indication about just how much Sony is making on the system at present. But it looks like these early profits are just the start. Mainichi reports that CFO Nobuyuki Oneda said, presumably during an earnings briefing, that with continued cost cutting measures, the system could reach double digit profitability in the near future.

PS3 was Sony's standout platform for fiscal 2009, selling 13 million units, ahead of the 10.1 million of the prior year. The system also saw increased software sales, going from 103.7 million pieces of software to 115.6 million.

Bringing Sony's games business down, however, were the PSP and PS2. PSP saw a big drop in hardware sales, from 14.4 million units to 9.9 million, and a slight drop in software sales, from 50.3 million to 44.4 million. PS2 saw a drop in hardware, from 7.9 million to 7.3 million, and a major drop in software, going from 83.5 million units to 35.7 million units.

With the strong yen and these PSP and PS2 issues, along with drops in VAIO PC sales, Sony's Network Products & Services business, which encompasses its game and PC businesses, saw a 10.2% drop in sales to 1,575,800 million yen. The division operated at a loss of 83,100 million yen, a slight improvement over the prior year's 87,400 million loss.

For 2010, Sony expects to sell 15 million PS3s, 8 million PSPs and 6 million PS2s. It expects combined PS3, PSP and PS2 software to remain level with this year.

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