Sony ship 14.3m units WW, Miss Target

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NathansFortune

Regular
Sony posted the fiscal results. 14.3m PS3s, 8.0m PSPs and 6.4m PS2s.

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Sony as a group lost $3.2bn, but that was due to a one time accounting charge of around $4.4bn against some deferred tax assets. It doesn't really mean much, just a regulatory requirement and it is due to teh earthquake denting their profitability this year and next.

PS - I hope you are satisfied Rangers, they missed the target! ;)
 
From 2.9 to 3.5/6, that's not great and they have no hope for Q1 (PSN...) unless MS overshipped in jan-mar quater. Price cut is needed.
 
NathansFortune said:
PS - I hope you are satisfied Rangers, they missed the target! ;)
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Yup, I must say I was wrong that Sony would "never miss their forecast" and this restores my faith in their shipped numbers.

On the topic, I wonder what the 15m FY 012 shipped target means? Japan seems to be slowing down so it seems they wont hit it without a price cut, yet it's barely above what they shipped this year...seems odd. Too low for a price cut, too high for no cut...

Maybe it's to 249 late in the year, and they have visibility that first half PS3 shipments will be weak.

From 2.9 to 3.5/6, that's not great and they have no hope for Q1 (PSN...) unless MS overshipped in jan-mar quater. Price cut is needed.
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I except any price cut by either party will quickly be matched, so it'll be relative parity regardless. I am about 40% expecting one or more price cuts to be announced at E3 though.

As for Q1, MS might only ship 1.5 this quarter, since the 2.7 shipped was probably catching up a dry channel.

Anyways, it may be a symbolic thing, but I doubt who leads matters much in reality. Both are entrenched, third party support isn't going anywhere for either, and the difference is less than 10% WW
 
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I'd be shocked if the PS3 isn't cut to $199 at E3. I think the only reason we've gone this long without a price cut is because they've waited until it could be of a dramatic amount, instead of chipping away $50 a while ago.
 
Rangers said:
I except any price cut by either party will quickly be matched, so it'll be relative parity regardless. I am about 40% expecting one or more price cuts to be announced at E3 though.
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I think that price cut will benefit PS3 slighty more than 360 and I don't think they will announce 99$ Arcade (overkill) :D

199 PS3
199 360 250GB
149 360 4GB

That would be great.

Sony really should create cheaper SKU to copete with Arcade line, but what is left to cut? :)
 
Sony's future big move if possible/cost effective would be a flash enabled "core" model as we've discussed ad infinitum on these boards.

I think you guys are crazy for suggesting 199, the forecast would be more like 18m or more I think if so. I think for sure Sony's next step will be 249. Microsoft's will be 149/249 imo.
 
Rangers said:
Anyways, it may be a symbolic thing, but I doubt who leads matters much in reality. Both are entrenched, third party support isn't going anywhere for either, and the difference is less than 10% WW
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Another aspect of this is that the types of consumers being brought in this late in the generation and at much lower price points are unlikely to make much of an impact in the market. Extremely price-sensitive consumers who haven't been moved by this time by the amazing gaming experiences that have been on offer for all this time don't seem to me to be great potential sources of revenue. Unless we're talking huge numbers of them, of course, which I find unlikely.
 
Rangers said:
I think you guys are crazy for suggesting 199, the forecast would be more like 18m or more I think if so. I think for sure Sony's next step will be 249. Microsoft's will be 149/249 imo.
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I agree, sales are not so bad that such a reduction is required!
 
Foreign exchange impact took a serious chunk out of the operating income. Future outlook isn't better, with possibly another crisis in the Euro Zone looming in the horizon. Probably not a good time to get into a price war with Microsoft.
 
2.1m units in Q1/2011 means that after a long time of shrinking, the gap between 360 and PS3 has widened by 600K units.

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Rangers said:
Sony's future big move if possible/cost effective would be a flash enabled "core" model as we've discussed ad infinitum on these boards.

I think you guys are crazy for suggesting 199, the forecast would be more like 18m or more I think if so. I think for sure Sony's next step will be 249. Microsoft's will be 149/249 imo.
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I think I'll cast my vote of disagreement, I think a $50 price-cut simply maintains where they are now which as we see is sub-15M and $100 gets them to 15M and a little beyond ~15.3 - 15.6 but certainly not 18M. Japan is already off 150k from last year (CY), NPD shows YoY improvement (CY) but enough to both offset a decline in Japan+improving YoY in US? Whats the status in EU flat, or up (CY)? EDIT: Having looked at the Nintendo slide again PS3 is definitely up in 2011 CY vs 2010 but towards the end of the quarter the drop is back to flat.

I'm at a point with Japan where I see price-cuts as irrelevant to that market with regards to in-home consoles.
 
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NavNucST3 said:
I think I'll cast my vote of disagreement, I think a $50 price-cut simply maintains where they are now which as we see is sub-15M and $100 gets them to 15M and a little beyond ~15.3 - 15.6 but certainly not 18M. Japan is already off 150k from last year (CY), NPD shows YoY improvement (CY) but enough to both offset a decline in Japan+improving YoY in US? Whats the status in EU flat, or up (CY)? EDIT: Having looked at the Nintendo slide again PS3 is definitely up in 2011 CY vs 2010 but towards the end of the quarter the drop is back to flat.

I'm at a point with Japan where I see price-cuts as irrelevant to that market with regards to in-home consoles.
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Looking at the GfK data I would say PS3 sales are down about 10% YoY since the beginning of April to the end of last week. Add in NPD and MC data and they are flat, but the trend is a downward one. My guess is 12-13m units without a price cut, around 14m with a $50 one and 15m+ with a $100 one. I think they will go with the latter but as late in the year as possible so they don't overshoot the target by too much.

My guess is they will ship around 2m next quarter and 2.6m the one after that which would be down by around 1m, but then they would put in a price cut for Q3/4 so sales of 8m and 2.8m to take them over the 15m mark for the end of the financial year.

A $50 pricecut would have to come at E3 and even then it is very debatable as to whether they will make it to 15m. It would need to be a bundle plus $50 off, maybe a Move bundle at $249 would do it, but I can't see it happening with just the unit at $249.
 
Before Sony starts thinking about cutting prices, the company needs to transition PSN to a fee-for-service model. It's hard to compete on price when your network is an expense to you, while for you competitor, it's a source of income. Just say that recent event has demonstrated the need for additional investment in the Sony Online Community. In the interest of members...yada yada...starting next year, PSN will cost 50 bucks a year. Obviously, it'd be a PR disaster if you try to charge existing members. Free membership for the life of their PS3 has to be grandfathered in. Indeed, that can be use as a mean to boost sales in lieu of a price-cut: anyone who buy a PS3 before the end of the year will get free online gaming. People will do the calculation and think to themselves, "Hey, my PS3 will practically pay for itself!" Keeping the profit margin high for the time being while opening a new source of revenue--what's there not to like?
 
Is PSN losing money now ? A free network does not necessarily mean a money losing venture (See Google). PSN has multiple revenue streams anyway.

From network perspective, I think it's more important for them to figure out what they want to do with SOE and PS Home, and also explore new business models like free-to-play games. Don't restrict PSN to Playstations.

Equally important is the user experience. Make it easy and fun to use.
 
patsu said:
Is PSN losing money now ? A free network does not necessarily mean a money losing venture (See Google). PSN has multiple revenue streams anyway.

From network perspective, I think it's more important for them to figure out what they want to do with SOE and PS Home, and also explore new business models like free-to-play games. Don't restrict PSN to Playstations.

Equally important is the user experience. Make it easy and fun to use.
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I think the PSN is ~$145 million in the black, though with the hack costing an estimates $171 million, it's kind of a moot issue!
 
Thanks ! I'm also curious to see if Google will allow Sony to rollout Qriocity for Android phones. Google's own negotiation with the music publishers didn't go too well.
 
I recall a few threads where people were doubting that the numbers would work out for Sony and they've been flamed crispy. Turns out they weren't that wrong, so maybe the firebats should acknowledge that.
All IMHO, of course.
 
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