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Posted by:

MicahWright

Date:

January 31st, 2007 5:00 PM

Header:

Sony's Earnings

Bulletin:

I'm an investor, and, as a writer, I'm writing an original 3rd Party game for the PS3 right now, so this type of news is important to me. If it's not to you, sorry. :)

Anyway, Sony reported their earnings yesterday night and the results were actually pretty positive:

"As a whole Sony Group saw consolidated sales and operating revenues of $21.42 billion, up 9.8 percent on the previous year. Net income did fall to $1.31 billion, but only by 5.3 percent, rather than the 50 percent suggested only yesterday by a group of five separate analysts polled by Bloomberg. The analysts had suggested a net income figure of $690 million on revenues of $24.63 billion."
-Thus proving that once again, none of these loud-mouthed analysts knows what Sony's costs on the PS3 are, and that their best predictions are retarded in the extreme. 50% loss? What other job could you keep when your learned estimations were off by 45 fucking percent? Except Iraqi WMD estimation experts in the Bush Administration, I guess. I read stuff like this and I'm amazed until I remind myself that the people who call themselves financial advisers are the same big-mouthed drunken fratboys who damaged their brains with excess alcohol in college. That's when the entire Enron debacle/Ford & GM losing their ass to Toyota/any other business failing of America's becomes super clear. Ten, fifteen, twenty years out of college, our business leaders are still just drunken fratboys, only now they wear ties.

"The results for Sony’s game division were less positive, with sales up only 5.6 percent to $3.63 billion, despite the launch of the PlayStation 3. The division reported an operating loss of $440 million, compared to a profit of $560 million at the same time last year, as a result of manufacturing and marketing costs associated with the North American and Japanese launches."
-Oh, so sales were up... after everyone thought they'd be down. Weird. And how strange that a massive capital output to advertise a new game system for a year prior to launch would cost a fortune with only two month's worth of sales to offset it. It's astounding how "Chicken Little" these people are.

"The company again stated that 2 million units of the PlayStation 3 had been shipped in the two months after launch, making it he fastest selling PlayStation platform so far. The exact total for the third quarter was put at 1.84 million consoles sold – 0.81 million in Japan and 1.03 million in North America. By comparison, the PlayStation 2 sold 4.11 million units during the period, down by 23 percent on the same time last year. The PSP saw sales drop even further, by 72 percent, to 1.76 million in total. A new worldwide total for PlayStation 2 global sales was given as 115.36 million, with 24.76 million sold in Japan, 46.53 million in North America and 44.07 million in the rest of the world. The PSP’s worldwide userbase is put at 24.70 million by Sony, with 6.23 million sold in Japan, 9.58 million in North America and 8.89 million in the rest of the world."
- (A) 2 million units in two months. If they can keep anything near those numbers coming, then Sony will have crushed Microsoft by this time next year, what with MS only claiming 11 million installed X-Box 360 units + the additional 5 million they predict in sales this year. (B) That 116 million installed user base shows that there is a LOT of life in developing cheap games for the PS2, and smaller developers ought to be doing exactly that... take advantage of the lower costs to make a game which is drastically different than the expensive super-games on the PS3 & 360. (C) On the other hand, PSP sales dropped 72%... I'm tempted to say "Who are these people purchasing this handheld platform which clearly has no future?" -- but an installed user base of 25 million is double what the X-Box+X-Box 360 user base is, so there clearly IS a future for it if only Sony can get more people to make PSP games.

Which, ahem, I'm doing right now.

"Software sales for the third quarter were down by 16 percent for the PlayStation 2 at 78 million, with PSP sales up by 24 percent to 21.2 million. Initial software sales for the PlayStation 3 were put at 5.2 million."
-PSP sales were up 24%? Wow, I didn't know there were any games to buy for it...

"Not only did Sony beat expectations, but the company also raised its profit forecasts for the full year ended March 31st, from 660 million to $900 million."
-A 26% profit rise prediction? Sounds like it's time to buy Sony stock, especially since their stock FELL 5% on this "bad" news, thus proving, once again, that the best way to make money on Wall Street is to do a little research, listen what the herd of business-degree fratboys is saying and then run like hell in the other direction.

-Micah

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