Sony not planning to take a ‘major loss’ on PS4 hardware at launch

kaz hiraiIn an earnings call this morning, Sony revealed that unlike the PlayStation 3, it will not take a “major loss” on PlayStation 4 hardware when the console launches later this year.

“Unlike PS3, we are not planning a major loss to be incurred with the launch of PS4,” said Sony CFO Masaru Kato, reported by Eurogamer. Kato explained that with the PlayStation 3, Sony made the chip in-house and made expensive internal investments. “But this time, yes we have a team working on chip development, but we already have existing technology to incorporate and also product investment and all the facilities will now be invested by our partners, other foundries, so we don’t have to make all the investment in-house,” he said.

Sony did not provide a sales forecast—it also has not revealed anything about specific pricing—but predicted that sales will “increase significantly” overall in the next year, mainly due to the expected launch of the new console. At the same time, operating income will level out because of costs related to it, including R&D and marketing, Kato said.

Kaz Hirai’s first fiscal year as president and CEO ended with a profit of 43 billion yen ($458 million) after a record loss the year before, despite game sales dropping 12.2-percent and income from games falling 94 percent to $18 million.

Sales of PS2 and PS3 consoles also fell, from 18 million to 16.5 million, though PSP and Vita sales rose from 6.8 million to 7 million. That was partially thanks to a PS Vita price cut in Japan, though, which likely offset the extra sales. Luckily for Sony, the company’s other segments are reportedly stable, and smartphones and TV will be a focus going forward.