While Microsoft reported its earnings last week, this week, Sony has announced their financial results for Q4 and as expected, they knocked it out of the park; the company hauled in over $8 billion (converted to USD) in gaming revenue for the quarter.
For the quarter, Sony stated that they shipped 4.5 million PlayStation 5s and even though this isn’t a sales figure, it’s easy to conclude that every single console was sold. With the console perpetually out of stock, it’s safe to assume that the company sold every console that was shipped.
For the last generation console, Sony stated that it shipped 1.4 million units of the PlayStation 4 – a significant drop year-over-year. This is hardly surprising and it is expected that shipments of the older console will continue to fall for the foreseeable future.
In its earnings release, Sony confirmed that it is selling the PlayStation 5 for a loss, stating that “strategic price points for PS5 hardware were set lower than the manufacturing costs”. This is not unusual for consoles to be sold at a loss with the goal of recovering revenue from game and service sales post-sale monetization.
This likely also confirms that Microsoft is selling both of its next-generation consoles for a loss as well. Not unexpected but considering the PlayStation 5 is using parts also from AMD, Microsoft is likely not getting a bigger discount from AMD than Sony who likely bought more chips during the same period as Xbox.
When compared to the PS4 launch, Sony shipped roughly the same number of consoles during the launch quarter; PS5 and PS4 game unit sales reached 103.7 million, up from 83.3 million in the same quarter in 2019. The company also reported 114 million monthly active users on the PlayStation Network in the quarter that can be compared to 100 million Xbox Live monthly active users.
With Microsoft reporting 5 billion in revenue and Sony at 8 billion during the same period, it’s clear that Sony still has the edge over Microsoft in the gaming space. That being said, both companies appear to be doing well out of the gate for the initial launch window.