PlayStation 4

PlayStation 4

Often, when a CEO leaves a company there is a reason for the departure.  Maybe it’s poor performance on the CEO’s part, or maybe it’s poor performance on the company’s part.  Either way, that’s not the case with Sony.  Sony’s new CEO Kenichiro Yoshida has been running the company for a few months now, but fortunately, it was left in pretty good standing for him.  That’s not to say that he doesn’t have his own vision and ambitions for Sony.  It simply means that it was doing well when he took over.  He has a three-year plan to focus primarily on the entertainment and imaging businesses. All of that said, we shouldn’t be too quick to jump on the Sony bandwagon.  Why?  They’re doing good, but they could certainly be doing better.

In fact, there isn’t anything overly extraordinary about the numbers.  Sony did record $17.9 billion in revenue for the last quarter, from which it extracted almost $1.8 billion in profit.  While that’s not awful, it could be better.  If you’re wondering which division is helping to increase these numbers – it’s PlayStation.  PlayStation head John Kodera said a few months ago that he suspects Sony is getting close to selling as many PS4 consoles as it’s ever likely to. Declining hardware sales is part of the natural lifecycle of consoles, of course, but that doesn’t seem to be having any effect just yet.

From April to June, Sony sold 3.2 million PS4s, which is slightly less than were sold during the same period last year.  But again – that’s not bad.  In addition, just over 40 million games were purchased, and the number of PlayStation Plus subscribers is holding steady at 33.9 million, which is down from 34.2 million at the end of March.  Again – not bad numbers considering.  In total, Sony’s PlayStation arm brought in nearly $750 million in profit which is more than twice as much money as any other department.

Even if the console sales start to decline, there are still a bunch of games coming out that will definitely keep money flowing in the right direction.  Spider-Man arrives around the beginning of September, and Sony is dropping Assassin’s Creed: Odyssey, Battlefield V and Red Dead Redemption 2 all in October.  In addition, gamers also have Ghost of the Tsushima and Hideo Kojima’s Death Stranding to look forward to down the road.

But if PlayStation is what is helping to keep Sony doing so well, then where are they lacking?  That would be in their smartphone division. A few quarters ago, mobile did actually make Sony some money, but that seems to have been a momentary departure from the norm. Sony Pictures also lost the company some money this quarter, but that’s kinda par for the course. The movie biz was roughly $68 million in the red, but that’s less than the company lost during the same period last year. Just two movies were released during the quarter, though, and Sicario: Day of the Soldado was only in cinemas for two days before the books were shut for another three months.

All that said, this wasn’t a bad quarter for Sony. PlayStation hardware, software, and services continue to pull in the biggest numbers, and other departments are performing characteristically. The company is flush with cash from selling some of its Spotify shares after the streaming service went public earlier this year, banking $768 million, or $501 million in pre-tax income after expenses.