Sony Cuts Profit Outlook By Forty Percent

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It's sad that the only time Sony hasn't posted a loss in the last five years is when it sold off its HQ buildings a year ago for a billion each. Hopefully the PS4 sells at a profit right out of the gate. :(

Sony made an operating profit of ¥14.8 billion ($151 million) in the second quarter of its fiscal year, as strong smartphone sales and a weak yen partially offset poor performance in the entertainment division. The company's mobile division brought in ¥418.6 billion yen ($4.27 billion), a 39 percent year-on-year increase, but Sony's net loss overall was 19.3 billion ($197 million).
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Doesn't this happen for every company, like MS and Nintendo, before every major console release?
 
Kinsaras said:
Doesn't this happen for every company, like MS and Nintendo, before every major console release?
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It has happened to Sony for at least the last five years straight. The only time they have posted a profit was when they sold both HQ buildings for a billion each last year. The company seriously needs to get its poop in a group. :(
 
What, did Sony turn to the AMD profit model or something? :D
 
Well considering that, aside from the Playstation, Sony hasn't produced anything in the consumer electronics dept. that has been worthwhile or desirable since at least the 1990's, is this hardly surprising?

Sony is a company that once had a great reputation for quality and innovation, and they pissed it all away on dead-end proprietary tech and products that ranged in quality from simply *meh* to mostly outright garbage but still carried a premium price simply because they said "Sony" on them.

Even though I've given in a bought a Playstation or two, Sony has been on the top of my -Do Not Buy- list for well over a decade now and frankly I'd love to see the company fail so ultimately it will break up and the electronics division could stand on it's own again.
 
WhiskeyTangoFoxtrot said:
Sony is a company that once had a great reputation for quality and innovation, and they pissed it all away on dead-end proprietary tech and products that ranged in quality from simply *meh* to mostly outright garbage but still carried a premium price simply because they said "Sony" on them.
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Agreed. When their stuff was made in Japan it was superior to anything else.
 
I miss quality Sony products. But like any company that is driven by the need to answer to shareholders they keep trying to find ways to maximize profit by slowly watering down quality in products and service.

Time will tell if they can regain the trust of the consumer, but I will not be buying any more of their products.
 
But but but... The PS4 is the most powerful console ever, even more powerful than a modern PC according to Sony. Nothing to worry about here.
 
Not having DLNA, Codec Support, Audio CD Support, or External storage support in the PS4 is sure to be a good start.
 
Ordeith said:
Not having DLNA, Codec Support, Audio CD Support, or External storage support in the PS4 is sure to be a good start.
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Also the fact that its sold at a loss. Lets say Sony does sell 1 mil in consoles on day one, each at a $60 loss.

thats 1mil*$60 which turns into 60 MILLION in losses. Now lets say people buy a few games maybe a controller, or PS+ to make up for some of that. lets say they make up 75% of it, they will still be 15 mil in the whole on launch day alone. Sonys outlook right now, is grim
 
VladDracule said:
Also the fact that its sold at a loss. Lets say Sony does sell 1 mil in consoles on day one, each at a $60 loss.

thats 1mil*$60 which turns into 60 MILLION in losses. Now lets say people buy a few games maybe a controller, or PS+ to make up for some of that. lets say they make up 75% of it, they will still be 15 mil in the whole on launch day alone. Sonys outlook right now, is grim
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Fuzzy math is fuzzy, but by your word problem, Sony would be making profits. After all, video games cost $60, and if the console is sold at a $60 loss, then they break even. The extra game and controller that you state would then put Sony in the black.
 
Kryptorchid said:
Fuzzy math is fuzzy, but by your word problem, Sony would be making profits. After all, video games cost $60, and if the console is sold at a $60 loss, then they break even. The extra game and controller that you state would then put Sony in the black.
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wrong, Sony does not make $60 per game sale, they get royalties that amount to roughly $7 per game. there is absolutely nothing fuzze about the math i did, period
 
VladDracule said:
wrong, Sony does not make $60 per game sale, they get royalties that amount to roughly $7 per game. there is absolutely nothing fuzze about the math i did, period
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I don't want to get into a pissing match, but A) yo do not know the profit margin on the PS4, B) You do not know the amount of profit Sony will get from PS4 games (though yes, it won't be $60), C) making baseless assumptions about consumer purchasing without empirical data tends to make things "fuzzy." For all we know, if someone buys one game and one controller, that could offset the loss to Sony.

On topic: Reading the article it is clear that the other divisions in Sony (Movies, TV's Digital Cameras, PC's, and to an extent Smartphones) are what's dragging the profit outlook down. Will be interesting to see how this changes once they release PS4 sales info.
 
Oh it's just so the guys at the top can get a fat bonus, when the PS4 sells like hot cakes, and beats sales projections (otherwise known as pulling a number out of your arse).
 
The loss on the PS4 is only $60, compared to the $241-306 for the PS3. It'll no doubt be profitable within a year or so. The PS3 cost roughly $285 less to produce by 2009 (that's $95 less a year if you want to look at it that way). In 2010 it was turning profits. Furthermore PS4 now requires people to get PS+ for multiplayer so that's added revenue along with games, controllers, etc.
 
Kryptorchid said:
I don't want to get into a pissing match, but A) yo do not know the profit margin on the PS4, B) You do not know the amount of profit Sony will get from PS4 games (though yes, it won't be $60), C) making baseless assumptions about consumer purchasing without empirical data tends to make things "fuzzy." For all we know, if someone buys one game and one controller, that could offset the loss to Sony.

On topic: Reading the article it is clear that the other divisions in Sony (Movies, TV's Digital Cameras, PC's, and to an extent Smartphones) are what's dragging the profit outlook down. Will be interesting to see how this changes once they release PS4 sales info.
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A) Sony themselves have said there is roughly a $60 loss per console. B) Sony currently makes $7 per game on the PS3. considering game prices DID NOT increase, its a relatively safe assumption
 
King Icewind said:
The loss on the PS4 is only $60, compared to the $241-306 for the PS3. It'll no doubt be profitable within a year or so. The PS3 cost roughly $285 less to produce by 2009 (that's $95 less a year if you want to look at it that way). In 2010 it was turning profits. Furthermore PS4 now requires people to get PS+ for multiplayer so that's added revenue along with games, controllers, etc.
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who do you think pays for the "free" PS+ games. Sony damn sure is paying for the rights to distribute them to active ps+ members. It IS NOT 100% proffit
 
Steve said:
It has happened to Sony for at least the last five years straight. The only time they have posted a profit was when they sold both HQ buildings for a billion each last year. The company seriously needs to get its poop in a group. :(
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Boohoo Sony that's what happens when you Rootkit your CD's, try and force proprietary shit on consumers for years, payoff movie studios for Blu-Ray exclusivity, have one of the most insecure and slowest networks in the world go down for weeks, and lie, brag and say the stoopidest most quotable lines in the industry again and again...and so on and so on and so on.

But this year..hey they are ok only because they kept their mouth's shut after watching what happened to MS and are just keeping the status que with zero innovation other than slightly faster hardware. But you just know Sony had or still have the exact same plans as MS.

Anyone that thinks Sony does not want to lock down their console, IPs, movies, music and games like MS tried to do is just naive or a dum fanboi.

It will happen. just gently..like Steam.
 
WhiskeyTangoFoxtrot said:
Well considering that, aside from the Playstation, Sony hasn't produced anything in the consumer electronics dept. that has been worthwhile or desirable since at least the 1990's, is this hardly surprising?

Sony is a company that once had a great reputation for quality and innovation, and they pissed it all away on dead-end proprietary tech and products that ranged in quality from simply *meh* to mostly outright garbage but still carried a premium price simply because they said "Sony" on them.

Even though I've given in a bought a Playstation or two, Sony has been on the top of my -Do Not Buy- list for well over a decade now and frankly I'd love to see the company fail so ultimately it will break up and the electronics division could stand on it's own again.
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And their movie and music studios return to North American ownership.
 
Been talked about for awhile now, but hopefully with their restructuring and new three tier business model they will turn things around.

They should have done that ages ago, I think during the PS3 era they had to take a step back and say WTF. They obviously learning from their mistakes with PS3 hopefully the other divisions learn from theirs.
 
I used to hate sony with a passion because of all the mpaa and riaa stuff. Additionally I still think most of their consumer devices are garbage. However I now have a sony projector (HW50ES) that I think is absolutely awesome and I'm pretty stoked for the ps4. DLNA, mp3s, etc support I don't care about too much. I got plenty of boxes hooked up to my projector for the other stuff.

Anyways.. hopefully they turn this crap around, I don't like microsoft's original stance on the xbone, and w/o sony they would have stayed the course. That and they reduced performance to put in other non gaming fluff that I couldn't careless about. I'll be doing my part and buying several games for the ps4.
 
Dawill said:
I used to hate sony with a passion because of all the mpaa and riaa stuff. Additionally I still think most of their consumer devices are garbage. However I now have a sony projector (HW50ES) that I think is absolutely awesome and I'm pretty stoked for the ps4. DLNA, mp3s, etc support I don't care about too much. I got plenty of boxes hooked up to my projector for the other stuff.

Anyways.. hopefully they turn this crap around, I don't like microsoft's original stance on the xbone, and w/o sony they would have stayed the course. That and they reduced performance to put in other non gaming fluff that I couldn't careless about. I'll be doing my part and buying several games for the ps4.
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exactly, typical nerd rage . die sony? why , so we can have less competition in the market? cause that will help things alone nicely
 
So much fanboy rage. Outside of the PS4 launch , Sony is hurting. And hurting badly. Cutting your outlook of profit by 40 percent is enough to fire the executive staff almost entirely. Shareholders for Sony already were not looking forward to another system launch after the mess that was the PS3. Now here they are again selling the PS4 at a loss while their major competitor is not selling at a loss and is breaking even.

Sony is going to have to do a lot more than hedge its bets on the PS4 if it wants to survive another 5 years. They need other divisions to become profitable and probably to split themselves as a corporate in to different entities.

I'm sure the PS4 will be a very successful stream for them but you can't survive alone as one of the top five electronics manufacturers on one product line alone.
 
brinstar117 said:
I miss quality Sony products. But like any company that is driven by the need to answer to shareholders they keep trying to find ways to maximize profit by slowly watering down quality in products and service.

Time will tell if they can regain the trust of the consumer, but I will not be buying any more of their products.
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They still get it right sometimes. The PSP, PS3 (esp. the early ones) and PS Vita are all utterly amazing pieces of hardware. I was really surprised at the build quality on the PS Vita. Sure Sony usually finds a way to fuck it up with insane software policies, but their hardware when motivated, is still world class.
 
Spire3660 said:
They still get it right sometimes. The PSP, PS3 (esp. the early ones) and PS Vita are all utterly amazing pieces of hardware. I was really surprised at the build quality on the PS Vita. Sure Sony usually finds a way to fuck it up with insane software policies, but their hardware when motivated, is still world class.
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Unfortunately, hardware is just a paperweight without software.
 
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