PS4 is selling well, but its launch helped Sony lose $1.25 billion last year

Wednesday, 14 May 2014 09:03 GMT By Dave Cook

PlayStation 4 sales are going strong at over 7 million sold, but it was a costly console launch that contributed to Sony’s $1.25 billion loss for the financial year ended March 31, 2014.

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It’s the company’s fourth annual loss in five years, totalling ¥128.4 billion / £746 million / $1.25 billion.

Compared that to the previous fiscal year, which saw Sony pull net income of ¥41.5 billion / £241 million / $406 million, and it’s clear to see that the Japanese giant had a costly year through 2013/14.

It wasn’t all negative however, as Sony’s net sales rose 4.3% to ¥7,767.3 billion / $75.4 million, thanks – the company said – to the strong launch of PS4, a leap in its smartphone sales and the impact of “foreign exchange rates.”

While other areas of Sony’s business are slipping, games continue to thrive with a year-on-year sales increase of 38.5%, totalling ¥979.2 billion / £5.7 billion / $9.6 billion.

As we said in the headline however, those console launches don’t come cheap, and the PS4 release contributed to the game division’s ¥8.1 billion operating loss and of course, Sony’s overall losses.

Just how expensive was the launch? Well, considering last year, Sony posted operating income of ¥1.7 billion / £9.9 million / $16.6 million, we’re guessing quite. Quite expensive.

It’s an expense that seems to be bearing fruit however, as Sony shifted some 3.7 million PS4, PS3 and PS2 units in Q4 last year, compared to 3.4 million year-on-year, and 14.6 million consoles for the whole fiscal year, down from 16.5 million in FY 12/13.

Vita seems to be in a bit of a pinch however, as Sony sold some 700,000 PS Vita, PS Vita TV and PSP consoles in Q4, which was a dip on the 1.3 million sold in the previous year. Sony stated that portable hardware sales have dropped from 7 million units to 4.1 million in a year.

Lastly, in software, Sony sold 91 million combined units in Q4 2013, up from 79 million the previous year, while overall software sales increased from 266 million units to 374 million for the full-year.

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