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Sony shares rise thanks to PS3 Slim and smaller than expected loss

The internet is in an upheaval over the latest numbers posted by Sony Corp. that revealed a net loss for the quarter ended Sept. 30 of 26.3 billion yen ($287.5 million), compared with a net profit of 20.8 billion yen in the same period last year. If you thought that was bad, according to 15 analysts forecast, it could have been much, much worst; but thanks to the newly redesigned console, and drastic cost cutting measures, things are looking up.

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RememberThe3573276d ago

All that reorganization seems to be paying off. I used to be critical of Stringer but his team pulled them out of the deep end. Well played Sony...

ReviewsArePolitics3276d ago (Edited 3276d ago )

IF I remember correctly, Sony posted a loss of 2 billion dollars in the fiscal year ending mid-2007, 6+ months after PS3 launched; a loss of 1 billion mid-2008; and a loss of 0.3 billion mid-2009; adding this quarter with be a net result or 3.6 billion. So from 4.7 billion to 3.6 billion there's a huge difference, where is it?

Remember it used to be natural to lose that much money on console launches, between 1 and 2 billion. Also, PS3 was supposed to cement Blu-ray in the market, so PS3 was actually cementing two formats, so that should be another between 1 to 2 million, IF NOT MORE, because Blu-ray was supposed to be a platform that would outsell just about every other console; Blu-ray will be in more homes than home consoles will be in. If the later applies, then it's a certainty that Sony will make a lot more than 1-2 billion dollars on Blu-ray royalties (or the BDA group, where their stakes are higher than any other company).

So, after this short but reasonable analysis, are the loses really *NOT* warranted? Sony is cementing one console that will last more than its previous consoles due to the fact that Broadband and semiconductors are advancing slower than before so the PS3 is pretty much "future proof" for a while (not to mention console functionality and power is at an all time high compared to PCs, the best exclusives are still on par with all PC games except Crysis (but then again, Crysis is comming with High Settings)). Blu-ray, while not as successful as DVD, will also be very successful.

Please give me quantitatively backed reasons about why these losses are NOT worth it for Sony, and also a reason why as gamers we should care about profit FIRST and games SECOND, especially in the face of the recent release of Uncharted 2 and an incredible year the PS3 has had.

I don't think gamers have ever been so spoiled with any other console in terms of features and amount of games, especially those that own the classic 60 GB version which can play all PS1 and PS2 games, which would amount to, quantitatively and qualitatively, the best game library every created and the most feature packed and powerful console ever (with no need to pay for additional fees nor need to suffer through excrutiating reparations processes of faulty consoles).

Rtard THE HD VERSION3276d ago

ITs because we spin numbers to our liking!! Don't you know ?

Genesis53276d ago (Edited 3276d ago )

Higher the risk, higher the gains or losses. Sony took some big chances this generation. Now it looks like they are going to start paying off.

MS played it safe and used existing tehcnologies to build their machine. Good for the short term but short term and low risk investments usually don't pay well in the end.

Economics 101.

@below
I hardly think in 2006 that Sony saw the US dollar taking the beating that it has and dragging the rest of the worlds economy down with it. The difference between the Yen and the US dollar is what is causing most of Sony's bleeding.

The housing collaspe in the US rattled finacial institution around the world. Showing just how much the world counts on a strong US currency.

mint royale3276d ago (Edited 3276d ago )

Where the hell did those so called 4.7 billion dollars came from?
IF I remember correctly, Sony posted a loss of 2 billion dollars in the fiscal year ending mid-2007, 6+ months after PS3 launched; a loss of 1 billion mid-2008; and a loss of 0.3 billion mid-2009; adding this quarter with be a net result or 3.6 billion. So from 4.7 billion to 3.6 billion there's a huge difference, where is it?

-------------

The 4.7 billion figure comes from the first 2 quarters of fiscal year 2010. They are in defecit by 1.1 billion so add that to the 3.6 and what do you get?

http://neogaf.net/forum/sho...

That link should help.

@above - I dont think such losses from 06 is a risk Sony thought they were taking. If you want a good business plan you can't look at Sony or MS. You have to look at Nintendo - since 1998 Sony have made $250 million on their playstation business. Nintendo however have made $22 billion. Theres just no disputing facts.

[email protected]
True the yen has hurt Sony but it should have hurt Nintendo just as much but look at Nintendo's insane profits. Its the business plan that was the problem for profits not the yen.

The Killer3276d ago (Edited 3276d ago )

ps3 cost is around 300$ thats a fact, it could be less a bit or more a bit.

sony lost billions in the gaming division but they dont mention how much profit they gain from blue ray, because probably they consider blue ray as part of another division.

sony doesnt say about their software gains however i do believe that it is possible that they still lose from their gaming division because they are spending a lot of money on their AAA games and online free functions etc.

i believe sony fiscal year(which ends in 2010 end of march) will be a profitable because a lot of ps3 is being sold and more games is being bought.

i thank Sony for investing so much money for our entertainments and they do deserve profit along with nintendo but NOT the greedy MS who is selling bad hardware and charging people to play online.

UPDATE

@mint royale

and where did you get this info "since 1998 Sony have made $250 million on their playstation business"??????

are you sure you didnt got mixed by using million instead of billion? if you would say 250$ billion it will make sense since 1998, because PS1 and PS2 was making hell of a money for sony.

mint royale3276d ago (Edited 3276d ago )

@the killer

Look at my link that has all the official figures from Sony's game division since 1998 (when they created the separate games division). They have made $264 million to be precise.

Nintendo largely thanks to the wii have made $22 billion.

And Microsoft have p1ssed away $6.5 billion.

All these figures include software and hardware profitability.

sikbeta3276d ago

This obvious, as I said before The PS3 Slim was launched in September, for 9 consecutive months Sony sold the fat model at lost, before September First they cut the price ($100) of the remaining fatties + the decrease in PS2 hardware and software unit sales, this is related to the new price of the PS3

This is the best move Sony did, they no more lose money on manufacturing, can reduce the materials costs and keep the console quality

From now on, we will see profitability for every FY quarterly financial report, this is the 3rd year on the market and based on the PS3 life cycle, we will see 7 years of profit

Playstation Profit = More Quality Games For The Growing Fanbase

GAMERS FTW!

DaTruth3276d ago

Bu, bu, but, Sony is doomed, don't teh shareholders know???

Lifendz3276d ago

Did you ever get a PS3? I remember you complaining about the price being too high back when it was 399. Just wondering.

+ Show (6) more repliesLast reply 3276d ago
RememberThe3573276d ago

*cough*takecontrol*cough*

Excuse me. I mean to say fanboy's need to stop hating so much. I know it's easier that way, but if Sony goes, so the the Playstation, and a fourth of the music industry, and a massive prosion of the movie industry, and a massive portion of the electronics industry, No to mention all the thing they R&D.

Have you guys seen this thing, it freakin awesome!
http://www.iheartchaos.com/...

Sarcasm3276d ago

I hope Sony will start to profit and never abandon their games division. Otherwise, we're stuck with that "other" brand... Oh lord...

ReviewsArePolitics3276d ago

I'll quit gaming, or at least I'll stop supporting the industry the way I do. That is, unless Nintendo gets their act together or another competitor enters the fray. I refuse to sustain another monopoly from the company with most monopolies in the market; if I have no other choice, I'll have to buy used games, if not something else. I can live without playing online on a paid service that should be free. I also can live buying faulty console after faulty console with no warranty if I'm never going to pay for the games or the services.

naughty573276d ago

Sony really got some cool tech guys in the firm

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