Sony Financial Results, Q2 2008

[liolio]

Thanks Karl. That's -358.6billion yen so far, which is more than 1/2 of what the gaming division has made to date. On top of that Sony is predicting no profit in the gaming sector until 2009. This is also not including the incumbrance the PS3 has placed on the PSP and PS2 hardware and software sales. On it's own the PS3 is bleeding hard.

How much in $ Sony has bleed since ps3 introduction?
Seems to get really huge.

 

[Carl B]

How much in $ Sony has bleed since ps3 introduction?
Seems to get really huge.

You're asking a question in response to a post that itself was a response to the answer of the question you just asked.

 

[liolio]

You're asking a question in response to a post that itself was a response to the answer of the question you just asked.

Woah... I started a new job today... i woke up early, the job is far from my place...

again time to geo to bed?

 

[mrcorbo]

Going back to this, this is my previous yearly tally through fiscal '06:

.......So.... over the past nine/ten years, Sony's game division has contributed a net of 652 billion yen in operating income to Sony's bottom line. In dollars, this amounts to ~$5.5 billion in positive contribution.

Since then we have the year '07 results, which were -232.3 billion yen. So far in fiscal '08, the total inclusive of the most recent reported quarter has been -126 billion yen.

Thanks Karl. That's -358.6billion yen so far, which is more than 1/2 of what the gaming division has made to date.

I've never seen these 2 numbers in the same place before. It really puts the amount of money we are talking about here in perspective. The PS3 drain is costing Sony over half as much as they have made in profit since they entered the console business, all this while having continuing PS2 sales and growing PSP sales to help moderate the losses? That's insane!

 

[dobwal]

Just making a unified format doesn't make price-sensitive consumers immediately convinced. Actually the more fierce the competition becomes for HD media, the more quickly player prices go down. If there was no format war hardware prices would be more expensive and the install base would be smaller at a given time. The competition in the game market drives it too, you can buy PS3 for $399 this year which makes the growth pace of Blu-ray even faster.

Obviously reported in the games segment. So the game division does the work of electronics that advertises the Blu-ray format.

No it's in 2008.

Usually mass adoption of a format doesn't happen until a winner is declared. The longer this current format war continues the more competitve digital distribution will be once a winner is declared.

 

[Nesh]

Thanks Karl. That's -358.6billion yen so far, which is more than 1/2 of what the gaming division has made to date. On top of that Sony is predicting no profit in the gaming sector until 2009. This is also not including the incumbrance the PS3 has placed on the PSP and PS2 hardware and software sales. On it's own the PS3 is bleeding hard.

What are these 358.6 Billion supposed to represent?

edit: and how were they collected?

 

[Carl B]

I've never seen these 2 numbers in the same place before. It really puts the amount of money we are talking about here in perspective.

Well, I am a master of data and statistical analysis afterall.

The PS3 drain is costing Sony over half as much as they have made in profit since they entered the console business, all this while having continuing PS2 sales and growing PSP sales to help moderate the losses? That's insane!

It's a severe drain, indeed. Anyway but I'll have more to add to add in a little bit; I've finished listening to the conference call but need to re-listen to some portions again (heavy accents).

 

[TheChefO]

I've never seen these 2 numbers in the same place before. It really puts the amount of money we are talking about here in perspective. The PS3 drain is costing Sony over half as much as they have made in profit since they entered the console business, all this while having continuing PS2 sales and growing PSP sales to help moderate the losses? That's insane!

Not as bad as MS, but catching up quick...

MS lost 4 billion on xb1 and I'm pretty sure they're still posting significant quarterly losses.

 

[Carl B]

edit: and how were they collected?

They were collected through the aggregation of financial reports, obviously. Anyone could go to the Sony IR website right now and do the same, but since we have a lazy populace satisfied with getting their news from sources like Gamespot and such, it falls to me.

Not as bad as MS, but catching up quick...

Well, I don't know about "catching up." MS has incurred huge losses in their gaming adventure. I've tried doing something similar for MS' numbers in the past, but it's a little more opaque due to the way they structured their finances in the early days of XBox.

 

[RobertR1]

They were collected through the financial reports, obviously. Anyone could go to the Sony IR website right now and do the same, but since we have a lazy populace content to get their news from sources like Gamespot and such, it falls to me.

We appreciate all your hard work for us Carl. < see, I can learn!

Outside of the gaming sector the rest looks quite good. The Bravia are great sets. At the top of the food chain in LCD's. Not only performance wise but quite aesthetically pleasing which is a big draw to flat panels. Unless something drastic happens there, they should come out of the holidays well in that sector.

 

[betan]

Anyway, listening to the conference call Q&A right now; the inventory write-down did actually include the current quarter price-cuts paid forward, which amounted to 71.1 billion yen of the present quarter loss.

Does the write-down mostly come from the unsold inventory from last quarter as the new inventory buildup should be reported with the updated price/value?

If so, 71.1 seems a little high since the total inventory was 227 million.

 

[Carl B]

Does the write-down mostly come from the unsold inventory from last quarter as the new inventory buildup should be reported with the updated price/value?

If so, 71.1 seems a little high since the total inventory was 227 million.

They're separating out the 40GB unit from the other SKUs; the write-down is associated with the 60GB and 80GB units, inclusive of anything on the shelves, in inventory at Sony, or left to be assembled/manufactured (whatever number that is).

 

[TheChefO]

I've tried doing something similar for MS' numbers in the past, but it's a little more opaque due to the way they structured their finances in the early days of XBox.

I'd say it's equally difficult to guage ps3 losses as they've had psp and ps2 profits to muddy the waters.

My point was, Sony's doing bad financially with ps3, but not as bad as MS ... yet.

 

[Carl B]

I'd say it's equally difficult to guage ps3 losses as they've had psp and ps2 profits to muddy the waters.

Chef we're talking about gaming here; PS2 and PSP are a part of that. Yes, PS3 losses for the quarter were probably worse than the divisional net result. But PS2 and PSP being included in the yearly results is wholly different than the way MS reported their public XBox figures for the first several years, and even now (though it's much improved).

My point was, Sony's doing bad financially with ps3, but not as bad as MS ... yet.

On a quarterly basis I have no doubt that Sony will be far worse off than MS today (MS reports later today); but on a cumulative basis, I expect Sony to end the gen in the black for the total of its efforts over the years, whereas MS will still be solidly in the red.

 

[Laa-Yosh]

Give MS the same 10 years that Sony had, and rembember that they've been fighting an uphill battle against the market's strongest player with the Xbox... They may end up with more profit in the end, depending on how the next generation fares.

 

[Nesh]

They were collected through the aggregation of financial reports, obviously. Anyone could go to the Sony IR website right now and do the same, but since we have a lazy populace satisfied with getting their news from sources like Gamespot and such, it falls to me.

edit:Numbers in your post and numbers in article seem different. I coverted the numbers in the article into yen and they are not the same as the billions of yen you mentioned. How did you get the last two billions?

Can you give me a direct link to the site with their financial numbers?

i d like to check myself

 

[JardeL]

Give MS the same 10 years that Sony had, and rembember that they've been fighting an uphill battle against the market's strongest player with the Xbox... They may end up with more profit in the end, depending on how the next generation fares.

Meh, it is not that difficult if you keep in mind that MS has a huge budget [ Xbox cost them 4 billion USD ] ...

 

[Carl B]

I am talking about the 358 Billion yen figure. Or is that the numbers mentioned in the article converted into yen?

Are we sure we are looking at comparable numbers? Because it sounds a bit far fetched that Sony might have made losses in one year that are equal to half of the profits Sony has made from the gaming division for 10 years.

To make another point, the article says that they made losses of 841 million and we are in fiscal 2007 according to a note in your post. It also says that last year Sony made losses of $381. In your data for last year there is a positive contribution of 8 billion yen.

I dont think the figures are comparable.

You're confused. Firstly, we're in fiscal 2008. Secondly, Sony's financial reports are delivered in yen; who cares about articles and what they say? All of my figures are in billions of yen - it's a little frustrating that this means you didn't even read my post notations.

Yes, you find it far fetched that Sony made losses in 1 1/2 years equal to their entire profit from the past ten, but that is nevertheless the case. My numbers are the numbers from their financial reports; there is no room for error and spin. I am 100% accurate in the breakdown, and by keeping all figures in yen currency fluctuations through the years are completely excised.

http://www.sony.net/SonyInfo/IR/

 

[Nesh]

You're confused. Firstly, we're in fiscal 2008. Secondly, Sony's financial reports are delivered in yen; who cares about articles and what they say? All of my figures are in billions of yen - it's a little frustrating that this means you didn't even read my post notations.

Yes, you find it far fetched that Sony made losses in 1 1/2 years equal to their entire profit from the past ten, but that is nevertheless the case. My numbers are the numbers from their financial reports; there is no room for error and spin. I am 100% accurate in the breakdown, and by keeping all figures in yen currency fluctuations through the years are excised.

http://www.sony.net/SonyInfo/IR/

Yeah I edited my posts after I noticed the fiscal year we are in. I am going to check it now. Thanks for the link (I actually converted the numbers in the articles into yen)

 

[dobwal]

I've never seen these 2 numbers in the same place before. It really puts the amount of money we are talking about here in perspective. The PS3 drain is costing Sony over half as much as they have made in profit since they entered the console business, all this while having continuing PS2 sales and growing PSP sales to help moderate the losses? That's insane!

Actually the PS3 drain is bigger than 358.3 billion yen.

Fiscal year ending in March 06 includes profits of only 8.7 billon yen. Q1 was -5.9, Q2 was 8.2, Q3 was 67.8 with a -61.4 for Q4 with the losses put on the shoulder of the PS3.

Now all the these figures are inclusive of PS2 and PSP profits which partially cover the loss due to the PS3.

I would be surprised if the PS3 losses were in the 500+ billion yen range.