PS5 Sales Will “Gradually Decline”, Sony Expects; PS Business Model Has “Significantly” Changed Since PS4

Sony expects PS5 sales to gradually decline as the console has entered the second half of its console cycle.

Yesterday, Sony published its most recent financial results, revealing that 59.2 million PS5 consoles were sold. This number is slightly below the revised forecast that Sony set some months ago, and also slightly below time-aligned PS4 sales. Although Sony managed to sell slightly below its own expectations, the PS5 still managed to sell five times as many units as the Xbox Series consoles during the fourth quarter of the fiscal year. At least, that's what analyst Daniel Ahmad from Niko Partners has estimated.

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During the conference call with investors, Sony talked about PS5 sales with the company's financial General Manager, Sadahiko Hayakawa, saying that the PlayStation business model has significantly changed since the release of the console's predecessor - the PlayStation 4. In previous generations, including that of the PS3, Sony was focused on increasing software sales in relation to new hardware. According to the executive, the PS4 console cycle can be seen as a transition period to a business model focused on platform playtime. "Looking at the console cycle, we think that PlayStation business model has changed significantly since the launch of the PS4", Hayakawa told investors. "The business model up to and including the PlayStation 3 was focused on increasing the number of software units sold in relation to newly sold hardware for each console generation. After a transition period during the PS4 generation, the PS5 model has shifted to where playtime on platform has increased due to expansion of the user community beyond console generations. Due to this change in business model, during the PS4 for generation, we were able to significantly grow profits in this segment, thanks to rapid digitalization and the expansion of network services."

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