Press Agency CNBC Sony’s market capitalization reportedly fell by $10 billion last week. After Japanese tech giants Downward sales forecast for game consoles Game station 5 for fiscal 2023, including profit margins in its core gaming business falling to their lowest level in a decade.
Sony, Japanese tech giant This was revealed last week The company will sell 21 million PlayStation 5 consoles in fiscal 2023, which ends in March. This is down from the previous estimate of 25 million units, the announcement states. As a result, Sony’s market capitalization or market capitalization decreased to $10 billion. According to CNBC calculations using FactSet data.
Analysts say Sony still has more serious problems with its PlayStation 5 sales targets, including declining profit margins in the company’s gaming business, which have fallen to their lowest level in a decade. The operating profit margin in the gaming industry for the third quarter of 2023, which ended last December. According to CNBC calculations, it is less than 6%, down from 9% in the same period in 2022.
Atul Goyal, equity analyst at Jefferies, said: “The downgrade of PS5 sales forecasts is not disappointing. But what is disappointing is the low operating margins in the core gaming business,” he said, adding that before the start of the first quarter of 2022, the operating margins of Sony’s gaming business have been between 12% and 13% and indicates that current profit margins for Sony’s gaming business are nearly the lowest in nearly a decade.
Serkan Toto, CEO and founder of Kantan Games, a gaming consultancy, said: He believes that hardware production costs have actually decreased since the PlayStation 5 is now more than three years old and believes that Sony will probably a new generation of game consoles will arrive with better performance, but at the same time, it is said, this is partly due to a further reduction in profit margins. is that the cost of producing software is increasing
“Spiderman 2,” released last year and produced by Sony’s Insomniac Games, cost $300 million to develop. such as these financial statements This appears to have a significant impact on the margins of the gaming business over time.”
Source: CNBC
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