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Sony Q2 FY3/2024 Financial Results (Jul - Sep 2023) | GN&S sales up by 32% YoY and OI up by 16%; PS5 HW at 4,9m (+48,5% YoY) and SW at 67,6m (+8,2%)

Also "SIE going bankrupt" doesn't make a lot of sense considering they're not exactly an independent company but a branch of a broader, financially healthy company, maybe they meant it will be in the red?
 
And even then it would be strange. Like SIE warned investors that their profitability would tank because of the planned discounts. So what would lead to such a unexpected loss? They did not produce ungodly amounts of the portal, the discounts for the slim are not big or not existent. Spider Men 2 sold within expectations and even if Destiny 2 falls flat of their prognosis, Bungie ist not big enough to tank the whole company.
 
And even then it would be strange. Like SIE warned investors that their profitability would tank because of the planned discounts. So what would lead to such a unexpected loss? They did not produce ungodly amounts of the portal, the discounts for the slim are not big or not existent. Spider Men 2 sold within expectations and even if Destiny 2 falls flat of their prognosis, Bungie ist not big enough to tank the whole company.

Well loss could be in not moving inventory as expected, I suppose. You take losses on cuts but then also fail to move sufficient inventory this will have knock-on effects in future quarters due to stranded inventory, I suppose.

Regardless, not very sensical.

Though the massive inventory has been a point of discussion across many threads, so that hasn't been overlooked or ignored.
 
Bankruptcy thing, of course, is a nonsense regardless of the situation with inventory. Sony's finances are quite healthy.

Yeah, but they are released a fair amount of products in 2016 too: PS4 Pro, PS4 Slim, PSVR.

PS5 quantities are not only larger, and cost more but I count at least 8 hardware pieces this year. Not to mention the yen appreciation alone is 25%+ since 2016

And even then it would be strange. Like SIE warned investors that their profitability would tank because of the planned discounts. So what would lead to such a unexpected loss? They did not produce ungodly amounts of the portal, the discounts for the slim are not big or not existent. Spider Men 2 sold within expectations and even if Destiny 2 falls flat of their prognosis, Bungie ist not big enough to tank the whole company.

SIE just forecasted $1.9B in profit for the fiscal year. No point trying to find credence in a nonsensical rumour.
 
Inventory numbers on the balance sheet is also dependent on when companies decide to take control of finished product from manufacturers and decisions to stockpile more/less components for manufacturing vs. having that be carried by partners. It's generally a decent metric to look at on a quarter to quarter basis, but comparing inventory figures across different generations when accounting and manufacturing policies could have changed massively is less useful without context.
 
All in all we will see during the next 3-4 quarters.

But I also do not believe he was fired. You do not keep a fired employee for more than half a year.
True, but at the same time they kept in a way where he literally does not make decisions anymore for the whole year. Not sure if there are some clauses in his contract for example. But that was a strange event. Granted not unexpected for some people.
 
SIE is more profitable and more successful than it ever was before. Them even going into the red is nigh impossible with the massive revenue it's making. It's Sony's biggest division making the most money of them all.
Entertaining the idea of SIE getting shut down is idiotic.
 
SIE is more profitable and more successful than it ever was before. Them even going into the red is nigh impossible with the massive revenue it's making. It's Sony's biggest division making the most money of them all.
Entertaining the idea of SIE getting shut down is idiotic.
it's just the usual made-up and nonsense fake rumor put out by fanboys to make console war
 
i’m always left confused both as to how sony/microsoft revenue is so much higher than nintendo, and how their profits are so much lower.

what is nintendo doing wrong that leaves them, despite selling very competitive amounts of hw/sw, with less than half the others revenue? what is sony doing wrong that leaves them, despite huge subscription numbers/digital sales/first party software, with increasingly miserable profits?
One reason is Sony charges higher hardware and subscription prices.

But the other big reason is how they account for digital/microtransaction revenue.

Nintendo only includes their own digital revenue, whereas Sony's figure includes the digital revenue of every single third party publisher.
For example Kirby is owned by Warpstar Inc, which is a joint venture by Nintendo and Hal Laboratory. Basically Nintendo owns 50%, HAL the other 50%. Pokemon is owned by The Pokemon Company (TPC) which is Nintendo, Gamefreak, Creatures about 30% each.

I'm not an expert at finance, and every company reports slightly differently within rules. With that in mind however, I'm pretty sure a lot of what we imagine isn't included in what Nintendo reports.
I believe Nintendo's revenue includes the full price of every first party, regardless of whether they own the developer/franchise.
 
I believe Nintendo's revenue includes the full price of every first party, regardless of whether they own the developer/franchise.
Maybe, but I'm sure they don't include other stuff such as Pokemon Go, trading cards, merch, Kirby cafe, etc. I'm not even sure if they include merch for their Mario and stuff, they rarely mention it and never goes in detail. That was my point, which is one of the reasons why it seems lower than what we expect despite all the things we think of hearing Nintendo. Also like you said and I previously posted, a lot of reports can be different per company within rules, making it hard to grasp the whole state of things.
 
Maybe, but I'm sure they don't include other stuff such as Pokemon Go, trading cards, merch, Kirby cafe, etc. I'm not even sure if they include merch for their Mario and stuff, they rarely mention it and never goes in detail. That was my point, which is one of the reasons why it seems lower than what we expect despite all the things we think of hearing Nintendo. Also like you said and I previously posted, a lot of reports can be different per company within rules, making it hard to grasp the whole state of things.
Why would they not? The royalties they get from mobile games, merchandise, cards etc. are included (I believe a lot of that is covered in in their "Mobile, IP related income" segment.
 
Why would they not? The royalties they get from mobile games, merchandise, cards etc. are included (I believe a lot of that is covered in in their "Mobile, IP related income" segment.
seems really low every quarter tho. And it's only royalties, once again that's like pure profit not revenue. We're talking about revenue. We don't know how much revenue is generated, only the portion Nintendo makes. Same with Sony and Microsoft including 100% of third party digital sales as "revenue", whereas Nintendo only includes their share according to some source.
 
seems really low every quarter tho. And it's only royalties, once again that's like pure profit not revenue. We're talking about revenue. We don't know how much revenue is generated, only the portion Nintendo makes. Same with Sony and Microsoft including 100% of third party digital sales as "revenue", whereas Nintendo only includes their share according to some source.
True, but that is how it shoud be. For merch sold through their own stores Nintendo can include 100% of the price. But for merch sold through other stores, or for money obtained through mobile or movies, they should only include their own cut.

Just because the Mario movie made $1 billion doesn't mean Nintendo should count that as $1 billion of their own revenue.

Sony includes 100% of digital sales because they are the retailer in that situation.
 
More context -

For PS5 to ship 16.8m in Q3 + Q4, it would ship more unit than best Q3 + Q4 for Switch.
For PS5 to ship 12m in Q3, it would ship more units than best Q3 for DS.
For PS5 to ship 12m in Q3, it will also be a 69% increase from Q3 last year. I'm not sure what is the biggest YOY increase for Q3 previously but we don't usually see over 50% growth YOY.

Traditionally Nintendo sells the most units during the holiday quarter. I'm looking forward to PS5's record breaking Q3 to break that trend.


Is this post missing a /s at the end?
Sony will revise the number down in Q3 report if they don’t think they will hit the shipment number. So will need to wait and see what they say in Feb.

Sony Group total revenue and profit forecast shows a decline in $ but an increase in yen from past years. Shows what a fuckery inflation and exchange rates have been.

4.9M, biggest Q2 in Playstation history from the data we have. Beats PS4's best by almost 1M. Once again shows how PS5 is reaching demand levels higher than PS4.

Most important thing, hardware still viable to do 25M.
Needs a historic 12M Q3 and then 4.8M Q4.

Big Q4 may be achieved with FF7R2 and maybe MHW2 releasing.

Revenue
  • $6.6B
  • FX adjustment - +$410M
OI
  • $338M
  • FX adjustment - $104M
  • Margin = 5.12%
  • Margin prior Q2 = 5.85%
Forecast
  • Revenue (+) -> $31.15B
    • Prior forecast fx adjusted -> $30.9B
    • +1%
  • OI (flat) -> $1.93B
    • Prior forecast fx adjusted -> $2B
    • -3.5%
So basically flat revenue, and a decrease in OI



A lot of people are missing this.

OI for this year is $1.93B with Bungie acquisition costs ~ $410M
The PS business by itself is giving OI of $2.4B, margin = 7.7%. All time high for PS was 13.5% which at current revenuw would be $4.185B
Last year would be $1.85B + $342M = $2.2B, OI margin = 8.5%

They missed the boat on peak pandemic gaming demand between 2020-2021. World was locked down, gaming was literally one of the few forms of entertainment available.
 
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Sony will revise the number down in Q3 report if they don’t think they will hit the shipment number. So will need to wait and see what they say in Feb.
Maybe. They've held clearly unattainable targets before, for "morale".
 
No they didn’t. They had the main components secured but over 2000 components go into making a PS5 and so 1 single missing component can delay everything.
They held targets through the 2021 holidays for morale, they attributed missing targets at the end of the FY on component shortages but they'd have known this ahead of time. We even had reports they cut internal production targets while still holding sales targets (which everyone knew they wouldn't meet).
 
They held targets through the 2021 holidays for morale, they attributed missing targets at the end of the FY on component shortages but they'd have known this ahead of time. We even had reports they cut internal production targets while still holding sales targets (which everyone knew they wouldn't meet).
So you’re posting speculation from Takashi and deliberately ignoring the investor Q&A in which they told investors that their confidence in hitting the production targets was because they had secured the chips needed. You need to stop spreading your speculation as fact, I’ve seen you repeat this same speculation as fact for months.
 
They held targets through the 2021 holidays for morale, they attributed missing targets at the end of the FY on component shortages but they'd have known this ahead of time. We even had reports they cut internal production targets while still holding sales targets (which everyone knew they wouldn't meet).

The source is Takashi, someone who has been wrong several times, most recently with incorrect PSVR2 sales...
 
No they didn’t. They had the main components secured but over 2000 components go into making a PS5 and so 1 single missing component can delay everything.
I am feeling a sense of deja vu since just a few months ago the exact quote was posted from Sony's CFO saying "but I want to keep the previously-held goal of selling 22.6m units next year unchanged as cutting it now would lower the motivation of the team" when this discussion came up before. This is objectively something they had said and was already pointed out to you fairly recently. Also, while Takahashi isn't perfect, that specific report seemed pretty accurate as Sony did have major supply issues and cut their target of 14.8 million to 11.5 million that fiscal year so that report seemed correct.
 
Tom Henderson said they cut internal production for the fiscal year as well, specifically of the slim from 18 to 14 million. So it’s not far fetched given their previous statements to wonder if they actually think they’ll hit their goal.
The source is Takashi, someone who has been wrong several times, most recently with incorrect PSVR2 sales...
I’d also note Takashi specifically wrote the article about the PSVR2 numbers from a research firm who was quoted in the article.
 
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Tom Henderson said they cut internal production for the fiscal year as well, specifically of the slim from 18 to 14 million. So it’s not far fetched given their previous statements to wonder if they actually think they’ll hit their goal.

What has that got to do with Sony's public FY forecasts changing?

Henderson claimed Sony's initial FY forecast was 30M.
Sony's first public forecast was 25M.

I’d also note Takashi specifically wrote the article about the PSVR2 numbers from a research firm who was quoted in the article.

Yet he still wrote an entire article about it, showing his confidence in a source who's estimates were wildly off.
 
I am feeling a sense of deja vu since just a few months ago the exact quote was posted from Sony's CFO saying "but I want to keep the previously-held goal of selling 22.6m units next year unchanged as cutting it now would lower the motivation of the team" when this discussion came up before. This is objectively something they had said and was already pointed out to you fairly recently. Also, while Takahashi isn't perfect, that specific report seemed pretty accurate as Sony did have major supply issues and cut their target of 14.8 million to 11.5 million that fiscal year so that report seemed correct.
Yeah, was trying to find that quote. I thought I hadn't made up seeing it.
 
What has that got to do with Sony's public FY forecasts changing?

Henderson claimed Sony's initial FY forecast was 30M.
Sony's first public forecast was 25M.
Well it certainly doesn’t help that Tom seems to confuse the two, but production is not shipments. His original reporting referred to the numbers as production targets. If the original production goal was 30 million for a 25 million shipment goal, a cut to the former would naturally point to a cut to the latter.

Yet he still wrote an entire article about it, showing his confidence in a source whose estimates were wildly off.
Still far different than claiming his sources for internal SIE news is false. Takashi has been right multiple times in the past.
 
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