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During Sony's recent quarterly financial conference call, CFO and COO Hiroki Totoki shared insights into the PlayStation business.
PlayStation Engagement & Sales Growth
Sony announced that cumulative play hours on PlayStation rose by 11% year-over-year for the quarter spanning July to September 2024. Astro Bot has sold 1.5 million copies in just nine weeks, with 37% of buyers having not purchased a Sony first-party title in the past two years. The game is popular among young users and families, marking a strong step in Sony's efforts to attract new players.
Learning from Live Service Successes and Challenges
Totoki emphasized that Sony has gained valuable insights from the success of Helldivers 2 and the struggles with Concord, especially in managing live service games. These learnings will be applied across its studios, particularly in development management and in refining the process of ongoing content updates and service scaling.
Strategic Focus: Single-Player and Live Service Games
Sony aims to develop a balanced game portfolio by focusing on high-potential single-player titles, leveraging their well-established IPs, while also investing in live service games that bring additional, though riskier, revenue opportunities. This balanced approach forms part of Sony’s mid-range strategy for growth.
Platform and Studio Business Outlook
Sony’s platform business is showing robust growth, and the company expects steady increases in user engagement and revenue through the second half of the fiscal year and beyond. In contrast, the studio business may experience a year-over-year dip in sales and profits in the second half, given tough comparisons with recent releases like Marvel’s Spider-Man 2 and Helldivers 2. Nonetheless, Totoki confirmed “steady progress” in the development pipeline, with plans to launch major single-player games annually starting next fiscal year, beginning with Ghost of Yōtei.
Optimizing Game Development and Release Timing
During the Q&A session, Totoki mentioned that Sony is not only restructuring its business but also revising its approach to game development and portfolio management. Cost-cutting efforts are ongoing in multiple areas, including sales and marketing investments, to optimize profitability. In terms of live services, Totoki highlighted the need for early and frequent “gates”—user testing and internal evaluations to better anticipate user reactions and detect issues earlier.
Totoki also expressed plans to carefully select optimal release windows for games to avoid overlapping launches and to maximize game performance.
PS5 Sales Target and Promotions
Sony remains committed to its goal of selling 18 million PS5 units this fiscal year. Although sales in the first quarter fell slightly below expectations, the second quarter met projections, and additional promotions are planned to boost sales in the latter half of the year. Notably, Sony has avoided a PS5 price cut, a departure from its approach with the PS4, yet sales remain strong. Furthermore, the pricing of the PS5 Pro has not negatively impacted overall sales.
PlayStation Network Account Requirement on PC
Addressing questions on the requirement for a PlayStation Network account on PC, Totoki acknowledged the potential for "pushback" but stressed that Sony aims to create a secure environment for all players. Maintaining a balance between safety and player freedom is essential, and Sony will continue to refine its approach to achieve this.
Sony’s financial targets remain ambitious, with plans to continue enhancing player experience across platforms while adapting to market dynamics and user feedback.
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