It takes a large area and quite a bit of time to turn a large ship around – and Sony is a big one. Sony this week reported a big increase in net profits for its 2008 second quarter ending September 30, 2007. The best news comes from its consumer electronics operation, which had a sizeable sales increase, especially in Cybershot cameras and Vaio PCs. The bad news came from Sony Computer Entertainment (SCE), its video gaming unit – the one that does PlayStations, which reported a bigger loss than previous.
Sales by Sony’s Computer Entertainment group were up 43% but its loss more than doubled. Sony sells PlayStation 3s (PS3) for less than it costs to make them. The company said it doesn’t expect to make a profit in its SCE operation until March 2009.
If it’s any consolation, Sony’s main competitor in video gaming consoles, Microsoft, usually loses lots of money in its Xbox operation (though not this quarter ‘ see separate story). Sony reported total sales of 5.6 million PS3s at the end of September. That compares to the 13.2 million Wiis that Nintendo sold in about the same period.
Nintendo this week raised its Wii sales forecast for 2007 by one million units to 17.5 million units. Sony said PS3 sales fall slightly short of the 11 million it had said it would sell for its fiscal year ending March 31. Sony continued to lose money in its TV operation but said it expects the unit to be profitable for the second half of this fiscal year ending in March.
Meanwhile Sony this week celebrated the seventh anniversary of the PlayStation 2 system selling 120 million units since its 2000 launch and more than a billion units of PlayStation 2 software. Sony reckons it has three more years left of momentum and expects another 12 million units sold this year and more than 1,500 titles on the market.
Nintendo though soured these comments by revealing that it is ready to launch its Wii game console in China and South Korea next year, which should accelerate growth and cement its recent lead over Sony Corp and Microsoft.