You could be forgiven for believing that everything is falling apart if you follow social media, since the games industry is engulfed in a tsunami of criticism. Although Sony released a rather optimistic financial report earlier this week, the headlines that followed contradict that: With a 29% year-over-year loss, PS5 is trailing PS4 globallyPS5 is trailing PS4 globally and failed to meet the updated projection.
React to PS5's Year-on-Year Decline
Here’s why context is important.
Between January 1, 2023, and March 31, 2023, sales of the PS5 skyrocketed by 219 percent year over year. This is because, as was widely reported at the time, Sony eventually resolved the stock shortages caused by the epidemic and initiated a massive global push to advertise the availability of their new-generation system. As a result, the brand shipped 6.3 million consoles in a quarter that broke records.
To put it into perspective, fewer than half of the aforementioned total—3.1 million units—were sold during the PS4's best-ever Q4 period. Therefore, the most recent quarter's 29% fall is being compared to historically high success. The 4.5 million consoles that PS5 did eventually ship, in fact, surpasses the previously mentioned PS4 record by a considerable margin.
While it is true that at this stage in its lifecycle, PS5 is trailing PS4 by less than a million units, more context is required. This generation has grown imbalanced due to the pandemic's disruption, and Sony has essentially been playing catch-up from the beginning. In addition, the PS4 Slim has seen multiple significant price reductions in addition to the PS4 Pro, which had already been released at this point in the previous generation.
This Monday, Mat Piscatella of Circana posted on social media that the PS5 is really 7% ahead of the PS4 debut in the US, indicating that the new generation console is lagging behind the rest of the globe. And there's a pretty straightforward reason for that: Sony has raised the price of their flagship format in almost every country save the US.
This post isn't meant to present PlayStationPlayStation in the best possible light—the company still has problems to resolve. Can it reach a larger audience and lower the cost of hardware? Can it quicken the development of first-party software so that games are released more quickly? Can it increase its profit margins as well, off that precarious position?
Hermen Hulst and Hideaki Nishino, the next CEOs, will have to handle all of these issues. However, sometimes it's necessary to provide some background, given the apparently never-ending flood of negative press surrounding the video game business. Without a question, Sony still has a lot of work ahead of it, but if you look past the alarmist headlines, the PS5 is actually doing rather well.
What do you think of the PS5's recent performance, and what can Sony do to keep things going? Do you think consoles will become obsolete soon, or are the internet haters going a bit too far in their criticism? Tell us in the comments below.