PS4 Success Backed by Robust Software Sales, Results Show

As far back as February, we knew that Sony was enjoying success with its PS4 sales, after the corporation mentioned that its full year target had already been met. A crucial companion to unit sales is software sales, and the 2013 results show a surge of 33%, ensuring that the new alpha console is profitable at the start of the new generation of gaming.

A total of 14.6m units of consoles were shipped in 2013, with at least 7m being Ps4 units alone.

What’s changing rapidly in the gaming division? Read on to find out.

The sales of the PS4, PS3 and PS2 (that’s still selling?) were not divided but it can’t be long before Sony updates us again on the previous figure of 7m PS4 sales. The PS2 sales can’t comprise much of the rest of that figure, showing us how the PS3 is doing.

Portable consoles continue to die out according to Sony’s sales, at least. Including the different models of the Vita and also the PSP, 4.1m units were sold in the last year, down from 7m in 2012. That figure is expected to drop further to just 3.5m units in 2014. The change in the gaming industry is not the demise of consoles, but the redundancy of portable gaming devices.

The Gaming segment of Sony posted an overall loss in 2013 of ¥18.8bn / $186m / €134m. This will fuel speculation as to whether is indeed breaking even on PS4 sales or not. The cost of goods sold will stretch as far as advertising and discounts, so it is possible that each unit sold breaks even but that the other costs involved eat into profit a little. Sony clearly isn’t worrying as it knows the amount of R&D investment that it takes to get to this point with a new generation of consoles and we can see that Sony expects the profit to really start coming in this year judging from their forecast in the chart above. We took a much closer look at the cost of manufacturing the PS4 and research indicated that in the end the console likely breaks even anyway.

An issue related to PS4 sales is software sales. Whether the PS4 is breaking even or not, software sales have long been a key driver of profit for gaming juggernauts like Sony. The sales jump on last year is a rise of more than one-third, which is the essential figure that the corporation needs to recoup investment from the years of secret work it took to make it and now produce it in the millions.

Another victory for the corporation in this area is that it has proven that console gaming is here to stay. In the run up to the latest consoles, the gaming industry faced broad criticism that it’s time was up and that smartphone games were taking over. Sony particularly has proved those critics wrong given the brand value of PlayStation, the success of the industry globally and positive reception by fans.

If you’d like to see how Sony performed in any business segment during 2013, check out our in-depth coverage here.