Sony stock slumps as PlayStation 5 sales to miss target

By Steve Goldstein

PlayStation 5 has entered the 'latter half' of its cycle, Sony says

Shares of Sony slumped in Tokyo trade on Thursday as the electronics giant cut its sales forecast, citing worse-than-expected PlayStation 5 sales.

Sony shares (JP:6758) (SONY) dropped 6.5% in Tokyo trade as the company cut its sales outlook for the current quarter by 100 billion yen ($666 million) and its adjusted earnings before interest, tax, depreciation and amortization by 15 billion yen.

Sony reported a 12% rise in fiscal third-quarter profit to 363.9 billion yen, as sales rose 22% to a company-record 3.75 trillion yen. Analysts polled by Visible Alpha expected a profit of 319 billion yen on revenue of 3.6 billion yen.

Projected fiscal year PS5 hardware unit sales of 21 million will fall short of its annual shipment target of 25 million units, Sony said. It's expecting a gradual decline in PS5 hardware sales for the next fiscal year.

In its fifth year since launch, Sony said the gaming device is in the latter half of its cycle, so it will emphasize profits.

Sony also estimates the impact of the Hollywood strikes on profits in the current fiscal year to be a little less than 20 billion yen.

The impact will stretch into the next fiscal year, due to a decrease in the number of films released, and in dollar terms will be "slightly less than twice as much as in the current fiscal year," Sony said.

Sony also said it is planning to spin off and list the shares of Sony Financial Group in October 2025.

-Steve Goldstein

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

02-15-24 0824ET

Copyright (c) 2024 Dow Jones & Company, Inc.