Today Sony hosted its quarterly financial conference call, and CFO and COO Hiroki Totoki provided more insight into the the PlayStation business.
During the livestreamed discussion, we learned that cumulative play hours on PlayStation during the past quarter (between July and September 2024) were up 11% year-on-year.
Astro Bot has sold 1.5 million units copies in the 9 weeks since its release. Interestingly, 37% of those who purchased the game had not bought any first-party game from Sony in the past 2 years.
The percentage of young users and families that purchased it is much higher than other first-party games, which means that it’s contributing significantly to the acquisition of new users.
The executive also mentioned that Sony has learned a lot in the field of live services from the success of Helldivers 2 and the failure of Concord, and plans to share these learnings across its studios including the areas of title development management and the process of continuously adding content and scaling a service after its release.
The plan is to build an optimal title portfolio during the current mid-range plan period, combining single-player games that are Sony’s strength and have a higher probability of becoming hits due to the company’s proven IPs, with live service games that pursue upside while taking a certain amount of risk upon release.
The Platform Business, Totoki-san continued, has strong momentum, and Sony expects to see stable expansion of user engagement and associated revenue growth in the second half of the fiscal year and beyond.
On the other hand, the studio business is expected to see a decline in both sales and profits year-on-year in the second half of the fiscal year, since it’ll have to compare with the launch of Marvel’s Spider-Man 2 and Helldivers 2.
However, we hear that Sony is making “steady progress” in the development of new games and improving the live service games process. Sarting with Ghost of Yōtei, the company plans to “continue releasing major single-player games every year from the next fiscal year onwards.”
If you’d like to learn more about Sony’s financial results, including an update on PS5 shipments, you can check out our dedicated article from earlier today.
During the Q&A session, Totoki-san mentioned that Sony hasn’t only changed the structure of the business, but also its approach to game development and portfolio.
Besides the layoffs, they’re enacting cost-cutting in different areas and optimizing investment in sales and marketing. Totoki-san believes that Sony is achieving good results with this operation, but it’s an ongoing process that the company needs to continue going forward.
Answering another question, Totoki-san mentioned that Sony is still learning in terms of live services, and they need to have many “gates” including user testing and internal evaluation, and these should have been done much earlier.
Later during the call, he elaborated further on the concept of “gates” repeating that they should have been done earlier and more often to detect problems and to better predict the reaction from the user base.
Going forward, Totoki-san also wants to select the optimal release windows for games so that they can be launched without cannibalization to maximize performance.
We also heard from Totoki-san that the target of selling 18 million PS5 units during the full fiscal year remains unchanged. While performance in the first quarter was slightly weaker than expected, the second quarter was in line with Sony’s expectations. In the second half of the fiscal year, there will be some promotions to push sales.
He also reminded that Sony did not introduce a price cut for the PS5 as it did for PS4. The current sales numbers have been achieved without needing to do that.
On top of that, he mentioned that the pricing of the PS5 Pro did not have a negative impact on sales.
Totoki-san also acknowledged that forcing players to use a PlayStation Network account on PC can “invite some pushback” but for live service games, it’s important to create an environment that everyone can enjoy safely. To do so, Sony needs to be able to enforce some rules, and striking a balance between that and the ability to play freely is very important. As such, the company has to continue to seek the best way to achieve this goal.
If you’d like to learn more about Sony’s financial results on top of an update on PS5 sales, you can read our dedicated article from earlier today.
