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Sony Q3: Game Operating Income $53M (PS3/PS2 15.6M in 2012)
- Thread starter Parmenides
- Start date
yurinka
Member
Think that there is also the PS3/Vita/WiiU multiplatform or ports possibility.
Codeblew
Member
Good point, I didn't think of the WiiU.
D
Deleted member 125677
Unconfirmed Member
Dat cover-up-of-lousy-vita-sales-in-psp-sales move.. 
This!! Deserves a new thread. IDC needs to be called out before next gen shenanigans are inbound.
Plus all the people who doubted yu along the way.
Then th MC cost...People are more inclined to react to permanent price drops. It'll have the software. 3DS did not take off until a near $ 100 price drop.
iamshadowlark
Banned
I think that has been accounted for in previous reports honestly. They never specify R&D so its hard to tell but the GAME division has seen some strange quarters.
Sony seems to be following a strict roadmap. They'll drop the price when it tells them to. Vita need to be marketed differently, it cant be played on a handheld card. Its a media device and thats how it should be angled with a $160 tag. Be the cheapest gaming tablet on the market.
Discontinuation of a product typically leads to one final spike in sales because you have to order then or never.
Interesting. It seems like their reports around the PS3 launch were all about just how much crazy ass money they were spending on development.
Metalmurphy
Member
And you aren't?
I'm not posting a statement, because it is almost impossible given the data we get from Sony, but you can't just equate amount of sell-through with amount of sold-in figures. There is so much more factors in this:
- You can have almost no stock at the end of a quarter -> shipping much more than usual on the next
- You can have too much stock -> shipping less than usual
- You can just flood the gates if you have a hot product -> overshipping (like MS did 2011)
- You have a new product line coming out -> shipping more of them, so there is enough stock.
etc etc.
And those 1,1m down figures only include a fraction of the world btw. There are several regions where Sony just launched 2011/2012 officially, so we just don't know anything concretely. Just my 2 cents.
- You can have almost no stock at the end of a quarter -> shipping much more than usual on the next
- You can have too much stock -> shipping less than usual
- You can just flood the gates if you have a hot product -> overshipping (like MS did 2011)
- You have a new product line coming out -> shipping more of them, so there is enough stock.
etc etc.
And those 1,1m down figures only include a fraction of the world btw. There are several regions where Sony just launched 2011/2012 officially, so we just don't know anything concretely. Just my 2 cents.
grimshawish
Banned
Its a poor media device though.
And gaming tablets are not a market.
Nor is Vita a tablet.
What are you talking about? PS3 reached 70 million on November 4th. Had they surpassed 360 there would be at least a press release. At best they reached 74 million PS3 end of 2012.
grimshawish
Banned
Rational one. Though I feel software could start stumbling if Vita's start collecting dust.
that would be fantastic.
source?
And work only with extreme lag. Not going to happen.
for some games, it doesn't matter.
I agree it's quite bold. how will it survive with only about 20-30 games being released per year? do you really expect retailers to order more units after the struggle to sell past inventory?
iamshadowlark
Banned
1st Course
Member
The big problem with the Vita is not even the hardware sales, it's the software sales. look page 14 here for more details:
http://www.sony.net/SonyInfo/IR/financial/fr/12q3_sonypre.pdf
These are some extremely bad software sales numbers, no wonder that 3rd party publishers have little confident in the system.
http://www.sony.net/SonyInfo/IR/financial/fr/12q3_sonypre.pdf
These are some extremely bad software sales numbers, no wonder that 3rd party publishers have little confident in the system.
I'm not bold enough to predict the number of software releases over the next few years. What made you arrive at that figure?
Indeed, though in decreasing numbers.
Edit: oh, hang on, you're the guy that said this:
I'm pretty sure you're way off here. My prediction doesn't seem so bold now.
Not for the gameplay but even in a turn based strategy game it's annoying if your inputs are only recognized after 0.5 seconds.
Common sense.
Half a billion op profit, Game profitable, PS3 highest selling home console of the year again. Considering Sony's recent form, this news is anything but terrible.
Sure vita is not where they'd like it to be, but it doesn't seem to be dragging Games figures into red territory.
i can't believe they thought they could get away with saying 16m vitas/psps for the year. they lopped off more than half of their forecast, and who knows if even that will be enough.
on the other hand, the ps3 is doing well. i can't imagine too many ps2s are being included in those numbers, so that's a good sign going into next-gen.
on the other hand, the ps3 is doing well. i can't imagine too many ps2s are being included in those numbers, so that's a good sign going into next-gen.
zomgbbqftw
Banned
Hmm, Sony haven't followed other Japanese companies and declared their FX gain in their income statement. There is a $1.5bn gain they have declared in other income, but not the headline income statement. It means they expect the weaker Yen to be a fleeting thing and don't want to bank on it like other Japanese companies. Toyota made a similar move a week or so ago.
Again, for the current three months, they paid a high net rate of tax, but that is coming down from over 100% net paid last quarter.
Significantly, "In Televisions, sales decreased 23.3% year-on-year to 182.7 billion yen (2,100 million U.S. dollars) and operating loss* decreased 86.6 billion yen year-on-year to 14.7 billion yen (169 million U.S. dollars)". It means the TV division losses look like they are finally coming to an end. I think they are ahead of schedule, and from March they will have left the low end sector completely and will only be competing in high margin product categories. Just to show how times have changed, for the nine months to Dec 31st, Sony took more revenue on smartphones than on TVs ($5.9bn vs $5.6bn).
Interestingly, for the first time I can remember for Sony there is a net trade of $3bn accounts receivable and accounts payable, and while that is meaningless in the grand scheme, it is the first time I can remember that they are set to get more money in than pay out. It could point to an upturn in fortunes if their order book is stacked.
The geographic info shows the lessening importance of the US to Sony's business as well (and the effects of a weak dollar). All segments other than China and the US show and increase in revenue, even domestic income is up. I think Sony's brand has a lot less power in the US than it used to, but it is still pretty potent in all other parts of the world.
Really though, the story is the same as it ever was with Sony. Middling performance from the core business, great performance from the media and banking divisions which continue to bail it out.
It's not a bad set of figures, but it should be better, and Sony's treasury being very cautious by not declaring their FX gains may spook the market today. The statement from their CFO says it all really "If this weak yen rate persists it should provide us with a big upside,". It's clear that Sony aren't counting their weak Yen chickens just yet, I think that's a solid move financially, but it will hit the share price today.
Again, for the current three months, they paid a high net rate of tax, but that is coming down from over 100% net paid last quarter.
Significantly, "In Televisions, sales decreased 23.3% year-on-year to 182.7 billion yen (2,100 million U.S. dollars) and operating loss* decreased 86.6 billion yen year-on-year to 14.7 billion yen (169 million U.S. dollars)". It means the TV division losses look like they are finally coming to an end. I think they are ahead of schedule, and from March they will have left the low end sector completely and will only be competing in high margin product categories. Just to show how times have changed, for the nine months to Dec 31st, Sony took more revenue on smartphones than on TVs ($5.9bn vs $5.6bn).
Interestingly, for the first time I can remember for Sony there is a net trade of $3bn accounts receivable and accounts payable, and while that is meaningless in the grand scheme, it is the first time I can remember that they are set to get more money in than pay out. It could point to an upturn in fortunes if their order book is stacked.
The geographic info shows the lessening importance of the US to Sony's business as well (and the effects of a weak dollar). All segments other than China and the US show and increase in revenue, even domestic income is up. I think Sony's brand has a lot less power in the US than it used to, but it is still pretty potent in all other parts of the world.
Really though, the story is the same as it ever was with Sony. Middling performance from the core business, great performance from the media and banking divisions which continue to bail it out.
It's not a bad set of figures, but it should be better, and Sony's treasury being very cautious by not declaring their FX gains may spook the market today. The statement from their CFO says it all really "If this weak yen rate persists it should provide us with a big upside,". It's clear that Sony aren't counting their weak Yen chickens just yet, I think that's a solid move financially, but it will hit the share price today.
First question in the q+a was about Vita and game, asking what they'd be doing in FY13 to improve Vita's situation and looking the Feb 20th, if the next generation would have more aggressive action on promotion than Vita had after its announcement.
It was pretty much the standard answer - said that they shared the view, Vita results are lower than expected, but it's a platform business, longer term horizon etc. etc. That they would strengthen the software lineup, and that marketing/pricing is being kept in consideration but that they couldn't discuss that today. That they will combine all possible measures to 'reactivate' PSVita. In terms of Feb 20th and next generation, they - again - said they couldn't talk about that today, but that Game was a core business for Sony and that they will make due injection of resources and investment this FY and next FY. Depreciation of yen will facilitate those efforts.
The analyst came back on Vita and asked more specifically what they would do to increase the software strength and third party development, noting a decline in western development resources (for Vita, I guess he means). Mentioned that 'Nintendo is spending so much money'. Sony guy said that they will work with 3rd parties, that when they launch a platform they don't simply open up licensing to third parties and leave it at that, that they develop a collaborative structure to help development, joint marketing and business promotion deals, and that they'll continue to do that.
It was pretty much the standard answer - said that they shared the view, Vita results are lower than expected, but it's a platform business, longer term horizon etc. etc. That they would strengthen the software lineup, and that marketing/pricing is being kept in consideration but that they couldn't discuss that today. That they will combine all possible measures to 'reactivate' PSVita. In terms of Feb 20th and next generation, they - again - said they couldn't talk about that today, but that Game was a core business for Sony and that they will make due injection of resources and investment this FY and next FY. Depreciation of yen will facilitate those efforts.
The analyst came back on Vita and asked more specifically what they would do to increase the software strength and third party development, noting a decline in western development resources (for Vita, I guess he means). Mentioned that 'Nintendo is spending so much money'. Sony guy said that they will work with 3rd parties, that when they launch a platform they don't simply open up licensing to third parties and leave it at that, that they develop a collaborative structure to help development, joint marketing and business promotion deals, and that they'll continue to do that.
aka your ass.
Welp, that thing is dead.
metalslimer
Member
It's blatantly obvious how little importance Vita is to them. Outside of Vita being doomed, the rest of the news for Sony looks good though.
You couldn't care less?
You're fighting an endless battle just not to admit that 360 got outshipped by PS3 last holiday season
PS2 is done and discontinued. The best we can account it for the quarter is 0.5m and that's being optimistic. Thinking that they shipped anything close to 1m PS2s is just crazy.
That leaves around 6.3m PS3 shipped, more than the 5.9m 360s.
Deal with it, not only 360 didn't gain any ground as you were expecting (and been claiming for months) but it got outshipped. PS3 was helped by the fact that Sony had to replenish the channels with the new Slim model. Shipments don't have a strict correlation with actual sales.
Sephiroth503
Member
Good to see an improvement (albeit still a loss in places but a smaller loss all the same!) in things for Sony. A healthier Sony is good for the gaming industry. I hope they continue the upward trend.
reptilescorpio
Member
Most likely result I expect!
metalslimer
Member
How's it going to do that when certain stores are already axing it from the shelf space and this will get much worse when Durango/Orbis launch? Hell stores will get rid of their Vita section before they get rid of the DS section. Also Sony initially said it would take 3 years to break even on Vita (including R&D and such), so even Vita just limped along presumably Sony would never break even on Vita. At this point opportunity cost is another thing that will not be kind to Vita.
Their handheld results are just terrible, if they want to keep the platform alive (and not just selling itself in mediocrity) they need to take the same steps Nintendo has taken, big price cut, money hatting key games, especially from Japanese developers considering that Japan and its games are absolutely relevant for dedicated portable gaming devices.
Opus Angelorum
Member
So in summary Sony have nothing concrete in place to change the fortunes of PSVita, and everyone should sit idly by and wait for things to happen.
Ridiculous.
shinra-bansho
Member
Fixed.
I was talking specifically about the games division operating profit vs sales. A profit margin of 1.7% is pretty bad, no?
1st Course
Member
The PS2 shipped 0.9m units in Q3 FY2011, so yeah there is a zero percent chance that the PS2 sold anything that close to 1m units this year. PS3 definitely outsold the 360 this quarter/year.
zomgbbqftw
Banned
Given that the result likely includes PS4 related costs, it's not so bad. That alone will have wiped off a fair chunk of the operating margin. Ken used to hide those costs in other divisions, but Stringer changed it so all R&D expenditure is allocated properly.
To be completely fair, even if they have anything substantial planned, they're not going to announce it in a earnings Q+A.
Not that I have much confidence that they do have any 'gamechangers' at hand, mind you.
What are they supposed to say?
"The following titles are scheduled for release this year:
Please see attached PDF for our marketing materials".
They have to be vague, to a degree. At least they realise the device is in trouble.
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