Sat, Dec 12, 2009 | 19:10 GMT
Report: Even with slimmer model, Sony still loses $37 per PS3 unit
A report from iSuppli has revealed that Sony may finally break-even with PS3 thanks to the slim model, despite still losing money per unit manufactured.
According to the report, at launch the console cost around $805 to build with the highest-priced version selling for $599, and the lower end selling for $399 – which cost the company $50 per console. Now, thanks to new 120Gb Slim, it only costs the company around $336 to produce and sell for $299 in the US – thus losing around $37 per unit produced.
Factoring in advertising, royalties and other expenses, the report disclosed that the company is very close to breaking-even, and with “renewed enthusiasm” for the lower price and only coming in slightly behind Xbox 360 in November, things may finally be looking up.
There is a breakdown of each part of the console in lovely PDF format through here.
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Posted in: Financials, Hot, PS3, Sony, hardware
Tags: isuppli, ps3 cost analysis
11 comments
#1
Razor
12/12/09, 7:54 pm
“Blue-Ray Drive”?
Yeah, I’m sure this report is credible.
#2
Mike
12/12/09, 8:07 pm
I don’t think one spelling mistake/typo means that something should be dismissed as rubbish.
But then again, given the amount of typos I make, I would say that!
#3
Retroid
12/12/09, 9:31 pm
Blue Ray, Upset Harry and Emo Billy.
#4
Bulk Slash
12/12/09, 9:42 pm
The console has been on the market now for 3 years and they’re still losing money on every machine sold? Ouch.
It will be really interesting to see how Sony put what they’ve learned this generation into their next console, particularly with Kutaragi out of the way.
#5
hitnrun
12/12/09, 9:42 pm
I don’t think it matters whether Sony is gaining a little bit or losing a little bit from one bit of the business (hardware). The overall money hole they’ve already dug and their long-term prognosis for climbing out of it is the larger concern.
#6
Psychotext
12/12/09, 9:46 pm
They can’t really dig themselves out of the financial hole the PS3 has made them hitnrun, but then they don’t really need to. All shareholders really care about is how much money you’re making now, rather than how much money you’ve lost over the long term.
As long as they can stabilise the division and make modest profits for the rest of the gen, all will be forgiven.
#7
bugmenot
12/12/09, 10:35 pm
a couple of components in there are sony made i think, like the bluray drive possibly. So even though its coming out of networked products divison’s pocket at least a tiny bit is going back to the consumer electronics division. That might mean Sony as a whole are breaking even on the PS3 manufacture. Then theres revenue from software which is what this game is all about, i think the only thing kicking their arse is the strong yen.
#8
Dean
13/12/09, 12:18 am
iSuppli might be able to guess on prices for stock components (eg: 120GB Hard Drive, or the Marvell), but given how Sony don’t give out a detailed cost breakdown of custom components (eg: RSX, or the specific BD-Rom drive in PS3), I believe iSuppli are pulling the bulk of these figures *out of their arse*.
In contrast, I’m pretty sure SCEI reported a few months ago that with the new HW revision (Slim, basically), they’d not be losing money on each unit sold anymore.
#9
Gekidami
13/12/09, 7:14 am
Nope, I think it was Jack Tretton who said that they are still losing money on each PS3 Slim sold. He said it in an interview when the Slim was launched.
#10
rainer
13/12/09, 9:47 am
I dont get how these reports can ever be considered accurate with the constant flux in the exchange rate of foreign currency and sourcing parts from different suppliers in different countries.
Unless iSuppli know exactly who, when and where Sony are buying from their report is nothing more than a wild guess.
#11
Dean
13/12/09, 9:59 am
@Geikidami.. Fair play, I guess I must have been thinking of the manufacturing costs being reduced (http://www.gamesindustry.biz/articles/playstation-3-manufacturing-costs-drop-70-percent).
As the GI.biz article states, if the costs have been reduced by 70%, then that gives figures *way* less than those that iSuppli have randomly plucked out of the air.